Featured Agriculture News

08/23/2017 - NAFTA, Tax Reform Eyed

A focus on the renegotiation of the North American Free Trade Agreement, or NAFTA, may be a reason for little action on bilateral agreements with countries such as Japan.

08/23/2017 - View From the Cab

View From the Cab farmers Brent and Lisa Judisch of Cedar Falls, Iowa, would like more rain for their crop, especially for their soybeans, but in Miami, Oklahoma, Zack Rendel has started to harvest his corn.

08/23/2017 - Todd's Take

Corn prices are headed lower, but this year's bearish arguments aren't as strong as a year ago.

08/22/2017 - Cash Market Moves

As the U.S. spring wheat harvest nears the halfway point, producers from around the Upper Midwest and Northern Plains are reporting a wide variety of yields, protein levels and grain quality issues.

08/22/2017 - Tax Reform on the Table

Congress will return to work in September trying to pass a tax-reform bill. A CPA who spoke to the American Coalition for Ethanol conference touched on some tax reform topics farmers may want to track as the debate begins.

08/22/2017 - USDA Weekly Crop Progress

Crop conditions were mostly stable last week with corn condition unchanged from the previous week and soybean condition up just 1 percentage point in the good-to-excellent category, making this week's USDA Crop Progress report neutral again for both crops, according to DTN Analyst Todd Hultman.

08/21/2017 - Raising a Stink

This invasive pest requires control nearly up until harvest, which makes it expensive and time consuming to manage.

08/21/2017 - Argentina to Accept US Pork

Argentina has banned U.S. pork products for 25 years but now has agreed to reopen the market after Vice President Mike Pence met with Argentina's president. The announcement conservatively estimated the market at roughly $10 million, but U.S. pork exports to South America are soaring right now.

08/18/2017 - Biofuels Under a Microscope

The Renewable Fuel Standard has been positive for the U.S. economy, a new study from Iowa State University finds.
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08/23/2017 NAFTA, Tax Reform Eyed

By Todd Neeley
DTN Staff Reporter

OMAHA (DTN) -- Though United States agriculture soon would like to see a bilateral trade agreement reached with Japan, Sen. Charles Grassley, R-Iowa, told reporters Tuesday he doesn't see that happening in the near future because of ongoing efforts to renegotiate the North American Free Trade Agreement, or NAFTA.

The urgency to secure such an agreement with the Japanese came about as a result of President Donald Trump's administration backing out of the Trans-Pacific Partnership earlier this year.

What's more, that urgency may have heightened a bit as a result of Japan and the European Union signing an economic partnership agreement in July.

According to press reports, Japanese duties on processed pork are expected to be phased out in the next five years. This is similar to what the U.S. was negotiating with Japan through the TPP.

Grassley told agriculture journalists that he's not aware of any similar bilateral negotiations taking place between the U.S. and Japan at this point.

"The NAFTA timetable is aggressive," he said, "with two more rounds before the end of September. It's more important to negotiate a good deal. The Trump administration must negotiate a deal that Canada and Mexico can agree to and that Congress can pass. There are many aspects of the economy that NAFTA touches.

"Trump now has the opportunity to set new standards on trade agreements."

As for a bilateral agreement with Japan, Grassley said having the U.S. trade negotiator tied up with NAFTA makes it difficult to achieve.

"It has to be negotiated at the lower levels," he said, "because the trade negotiator is spending his time on NAFTA, and once Great Britain leaves the EU then we need to pursue a bilateral agreement. I haven't heard of any negotiations moving forward (on Japan, Great Britain). I don't think any trade agreement can be accomplished real easily."

Because of the 2018 presidential elections in Mexico, Grassley said the U.S. needs to move quickly on NAFTA.

In addition, the U.S. dairy industry has expressed concern about access to Canada's markets. For starters, Canada over-quota tariffs on U.S. imports stand at 24% for fluid milk, 201% for skim milk powder, 298% for butter and 245% for cheese.

Tom Vilsack, former U.S. secretary of agriculture and current president and CEO of the U.S. Dairy Export Council, told a congressional committee in July that U.S. negotiators need to move fast to resolve problems with dairy access to Canada's markets.

Earlier this year Canada set a new pricing scheme that he said "essentially wiped out" an export market for ultra-filtered milk.

"Canada argues that they import large quantities of U.S. dairy product," Vilsack told Congress. "However, what Canada is not transparent about is how these imports are coming under a report program that forces the equivalent amount of dairy coming into Canada to be re-exported in many cases back to the United States."

According to the U.S. Dairy Export Council, U.S. dairy exports to Canada totaled $631.6 million in 2016, an increase of 14% from the previous year.

Grassley said it may not be necessary to take care of the dairy issues prior to passing a new NAFTA.

TAX ISSUES

Grassley said a number of closed-door meetings have been held by staffers for a variety of committees, in the event that Congress will move forward with tax reform yet this year.

"The necessity, as well as the failure on health care, makes it important to get something done as a victory for this Congress and for greater economic growth," Grassley said. "I look forward to the opportunity to have real tax debate in regards to tax cuts and tax reform."

At the end of 2016, a number of key biofuels tax credits expired and have not been renewed. That includes the $1 biodiesel blenders tax credit, second-generation biofuel producer tax credit, the special depreciation allowance for second-generation biofuel plant property, and the alternative fuel vehicle refueling property credit.

Most of these credits are aimed at developing advanced biofuel technologies, including cellulosic ethanol. A number of companies have launched commercial production at a handful of plants across the country.

Grassley said if Congress is unable to achieve broader tax reform, there likely would need to be a separate bill by year's end to extend the biofuels tax provisions.

Todd Neeley can be reached at todd.neeley@dtn.com

Follow him on Twitter @toddneeleyDTN

(ES/BAS)

08/23/2017 View From the Cab

By Richard Oswald
DTN Special Correspondent

LANGDON, Mo. (DTN) -- While it looks good, Brent Judisch's crop could use more rain.

"The corn looks good. Beans are OK but still need a rain. For August, all we've had is three rains, a half-inch, another half-inch, and six-tenths of an inch. We would like to have two more rains for the soybeans," said Judisch, DTN View From the Cab farmer from Cedar Falls, Iowa.

Climate and soil aside, not everything is perfect where Brent farms with his wife, Lisa, in northeastern Iowa. "Since Thursday, corn fields in the area not sprayed with fungicide have some anthracnose going on. Some corn is not doing so good -- it's starting to struggle a little bit. It may be caused by N deficiency. There's just a little bit of white mold in our soybeans," Brent told DTN late Sunday.

Brent and Lisa's earliest-planted corn is in dent stage and mature. Yield samples suggest it will yield 10 to 15 bushels per acre less than last year, but that's still more than those fields' five-year average. Later-planted fields will be checked for yields this weekend after Brent returns home. He'll wait for September to evaluate his soybeans. Humidity levels are adequate with early morning dew, and fog on Tuesday and Thursday. Soil moisture seems adequate -- for now. "It's been the same story all year," he said, adding that rain has been spotty.

When DTN reached Brent, he was in Sioux Falls, South Dakota, where he will join a crop tour of the Western Corn Belt. While traveling to Sioux Falls from his home, Brent checked fields along Highway 20 that he passes each year about this time. "We stopped and took a couple of samples. We found 140 to 150 bushels where last year they had 200 bushels per acre," he said.

Soon it will be harvest time for those crops; it's time to think equipment for those crops.

"Somebody has to buy the four-to-five-year-old combines. We normally buy combines that are four years old with about 800 hours and keep them about five or six years until they have about 2,000 hours," Brent said.

Combines are the most expensive piece of equipment found on most Midwestern farms; those hours in the field equal wear and tear and extra costs. The price farmers pay for lower acquisition costs is more maintenance. "On Wednesday, I put one combine in the shop. The one I run needs augers, belts, and chains replaced. I got it torn apart and ordered the parts. On Saturday, Rusty and I got two heads out. We have two platforms and one of them needs a new sickle," he said.

Last weekend's Annual Old Time Power Show held in Cedar Falls was a success. Brent helped Messiah Lutheran Church serve close to 900 meals there during the three-day event. "They ran out of food every day." Brent and Lisa's youngest daughter, Ellie, likes to fly their drone. "Saturday we flew the drone and got some pictures of the crowd without flying directly over them, and of how many parked there."

Like her mom and dad, Ellie also likes to dance. Tuesday was a social day for parents and boosters to come to school and show their support for the dance team by purchasing parking passes, season tickets, signs and other things to help fund school activities. On Saturday, Brent and Lisa attended their second ballroom dance in as many weeks. "A lot of our regulars go up to dance at Rochester, Minnesota, every month. It's fun to do something social," Brent said.

HARVEST STARTS IN OKLAHOMA

Meanwhile, outside Miami, Oklahoma, sampling time is over as mature cornfields yield their secrets to harvest. "We're finally getting the combine out today," View From the Cab farmer Zack Rendel told DTN midday on Monday. Later in the day, a happy Zack gave DTN his first harvest update of the season via text message. "Moistures are good. We're below 15 and yields are really great!" he wrote.

The first glitch of the harvest season was when harvest Day 1 was eclipsed by current events. "I'm a man down because Brent (Zack's uncle) and his family went to Kansas City to watch the solar eclipse. We've got our welding lenses ready here. We'll be at about 90%. I'm going in to school in about an hour to pick up Nathan and Charli and spend a couple of hours outside," he said, adding that as a safety precaution, younger children in school were only allowed to view the eclipse on TV.

Rain on Tuesday and Wednesday totaled 1.8 inches. Daytime temperatures in the low 90s, combined with humidity, pushing the heat index above 100 Fahrenheit. Unfortunately rain, heat, and humidity on harvestable stalks of corn means rot and sprouts beneath the husk on upright ears. "I'm starting to see a lot of ear rot and mold. We're getting sprouting. We could potentially have a problem," Zack explained.

Wet weather could also pose problems for Zack's milo crop if it causes new sucker heads to grow, which would delay harvest with green matter and immature grain. An application of glyphosate would be required. But if harvest is delayed after the herbicide goes on, lodging might be a problem. For now, the biggest problem has nothing to do with weather. "Birds have been pecking milo heads," he said.

Soybeans have enjoyed recent rains, adding additional vegetative growth and more pods. "They're getting bigger as the days go by. A neighbor told me the last time he had 8 inches of rain in August his soybeans made 80 bpa. Right now, we're sitting at 6 1/2 inches," Zack told DTN.

SERVING THE COMMUNITY

Zack describes his help with the county fair as community service. On Friday, he oversaw a tractor safety test where kids competed to see who was best at navigating courses both forward and backwards while pulling a grain drill or 4-wheel wagon. On Saturday, he helped prepare the dirt track for a demolition derby.

Zack fitted the new Demco 800-bushel grain cart with cab cams -- one on the tip of the auger, and one camera looking back. They'll give the operator a better view over tall truck boxes, or when backing up, and help avoid accidents when impatient drivers pass on narrow roads and at intersections and field entrances during turns.

Not everyone is happy about the timing of the new cams.

"We lost our summer help Wednesday. Job and Isaac (Zack's cousins) went back to school. Job was really looking forward to running that new grain cart," Zack said.

Richard Oswald can be reached at Talk@dtn.com

Follow Richard Oswald on Twitter @RRoswald

(ES/SK)

08/23/2017 Todd's Take

By Todd Hultman
DTN Analyst

Thanks to hot and dry weather earlier this summer, the seasonal high in December corn came later than usual this year when prices peaked at $4.17 1/4 on July 11. Since then, it has been all downhill for December corn. And, after prices broke a new low for 2017 on Aug. 10, it seems fair to say that corn's usual bearish seasonal influence is again at work as we head toward fall harvest.

The overall pattern is similar to what corn prices experienced the past two years. But if we look at 2016 as a recent example, this year's bearish arguments for corn don't look as strong. For that reason, I suspect corn prices won't fall as far as what we saw last year.

To explain, let's go back to last summer and recall how noncommercial traders piled into the long side of corn after Brazil reported problems with dry weather and the western Midwestern U.S. experienced hot temperatures in early June. Noncommercials amassed 362,525 net longs in the futures market by mid-June as the DTN National Corn Index peaked at $4.01.

As often happens at that time of year, the weather turned more favorable after mid-June, and speculators scrambled for the exit door. Not only was there a mountain of long futures contracts to liquidate, but the corn crop was headed for a record harvest of 15.15 billion bushels. The combination of those two factors took cash prices sharply lower, to $2.73 by the end of August.

When we look at how corn prices have traded in 2017, we see a similar bullish response to hot weather in early July, but the level of bullish enthusiasm was far less. The cash price peak of $3.57 on July 10, 2017, was far below last year's $4.01, and noncommercial net longs only reached about half of last year's level, totaling 177,147 as of July 18.

The latest CFTC data shows 103,259 noncommercial net longs in corn as of Aug. 15, so there is still some bearish pressure for speculators to liquidate as prices trade at new lows in 2017. But it does not compare to the much larger liquidation that took place last year.

Finally, with a smaller U.S. corn planting in 2017, and the most adverse weather conditions the U.S. corn crop has seen in five years, there is no question that this year's harvest will be smaller than the record crop of 2016. USDA's August estimate of 14.15 bb seems high, but even that estimate is down a billion bushels from 2016's record.

I don't want to underestimate late-summer harvest pressure, because bad things can happen to prices when buyers disappear. But it seems fair to say that whenever this fall's seasonal low is made, it should happen somewhere above last year's $2.73. I have no crystal-ball guarantees, but forced to guess, national cash corn prices near $3 seem like a good area for this year's low.

Todd Hultman can be reached at todd.hultman@dtn.com

Follow Todd Hultman on Twitter @ToddHultman1

(AG/BAS)

08/22/2017 Cash Market Moves

By Mary Kennedy
DTN Basis Analyst

As the U.S. spring wheat harvest nears the halfway point, producers from around the Upper Midwest and Northern Plains are reporting a wide range of yields, protein levels and grain quality issues. For this week's column, I talked to several farmers, elevator managers and grain merchandisers to get their observations on this year's crop.

As of Sunday, Aug. 13, USDA reported that 45% of the U.S. spring wheat crop had been harvested with South Dakota at 82%, North Dakota at 41% and Montana at 34% harvested.

The U.S. Drought Monitor released on Aug. 17 showed that 82% of North Dakota, 70% of Montana and 76% of South Dakota were still experiencing drought. In North Dakota, 44% of the state was in extreme or exceptional drought along with 25% of Montana and 6% of South Dakota.

Montana has received no relief, and the most recent NASS report showed that crop conditions continued to deteriorate due to the hot, dry weather. Soil moisture conditions showed no improvement from the previous week, with 98% of topsoil rated very short to short and 91% of subsoil rated very short to short.

North Dakota was able to recover from the drought a little thanks to rain finally making a visit to the state. NASS reported that rainfall amounts totaled 1/2 to 1 1/2 inches, with some isolated areas receiving over 3 inches. The moisture benefitted row crops and pastures, too, but the effects of earlier drought conditions were still being felt, noted NASS.

U.S. Wheat Associates reported in their Aug. 18 harvest reports that hard red spring harvest was on a pace similar to last year until widespread precipitation across the region delayed harvest progress.

"Prior to the rainfall, hot and dry conditions had accelerated maturity of the crop," U.S. Wheat Associates said in their report. "Approximately 18% of the samples have been collected and analyzed for the weekly harvest quality report. Test weight average is 60.6 lb/bu (79.7 kg/hl), which is down from last year's final average of 61.6 lb/bu (81.0 kg/hl). Average protein content is 15.4% (12% mb) compared to the 14.1% (12% mb) final average last year."

EASTERN NORTH DAKOTA, NORTHWEST MINNESOTA

An elevator manager in east-central North Dakota told me on Aug. 18 that they were 40% done in most of Traill County. But mainly west and north of there, they haven't gotten much done yet. Most farmers haven't been back in the fields since rain the weekend of Aug. 12 and likely won't get back until the weekend. "Looks dry the rest of the week but 40s at night, mid- to upper-70s daytime," he said. "We are at that time of year when they only can thrash wheat for six hours or less. Been heavy dew and gets damp early in the evening."

"Jury is still out on damage, if any, other than color will be affected," he added. "Wheat was barely ripe in the last 60% left and usually not much damage is done with the rains we got. We missed the big rains down south of Fargo and accumulated just 3/10ths or so, but with heavy dew and fog nearly every day since. Next week looks like we'll get going again. (The) farmer has elected to put it in the bin; very slow in the valley at the dump pits. Big carries posted to the Dec., but of course they put it away for that and don't normally sell it."

Of the 40% harvested, he told me that so far, there is no issue with vomitoxin, but the earlier showers took the color away to mid-60 DHV. DHV stands for "dark, hard, vitreous" kernels (also referred to as "color"). The test weight average is 62 pounds, so far, and the falling number is in the 380 to 450 range. Protein is all over the place at 12.2% to 16.8%, making an average of 14.4%. Protein scales have been getting smaller due to the high protein being harvested, especially in the drought areas. He told me his elevator was at +5 cents each fifth above 14% and minus 5 cents each fifth below 14%, but recently changed to +2 1/5, -2 1/5. Yields are better than expected so far and are averaging 50 to 80 bpa, with an average in the low 70s.

Foreign buyers especially demand dark northern spring (DNS) specifications with a 75% DHV minimum. When mature wheat is rained on, the kernel can be "bleached," causing the DHV count to drop. The falling number gives an indication of the amount of sprout damage that has occurred within a wheat sample. Generally, a falling number value of 350 seconds or longer indicates a low enzyme activity and very sound wheat quality. Sprout damage comes from rain on mature wheat standing in the field and can reduce the mixing strength of flour, cause sticky dough and affect loaf volume and shelf life. Many buyers from export markets require minimum tolerances of 300 to 350 seconds, and grain buyers generally discount wheat for falling number values below 300 seconds.

Keith Brandt, manager of Plains Grain and Agronomy, LLC, of Enderlin, North Dakota, said, "Spring wheat harvest in this area (is) about 50% done. Yields 60-65 bu/ac, great quality so far, 14.2 protein. Recent rains, which has greatly benefited the row crops, has really bleached out the wheat. Hopefully no issues with DHV or falling numbers or sprouts. Looks like good harvest weather for the next week."

Dave Blasey, who farms in eastern North Dakota, said that, "We haven't started (harvesting). Still seven to 10 days away for me. Been cool and wheat is still green and just isn't turning very fast at all. Looks very good, but had 2 to 4 inches of rain in the past week and quite a bit of lodging now, and I'm sure it will affect color and TW (test weight) at this point. "

"Quality of this year's crop is good," said Tim Dufault, who farms in Crookston, Minnesota, which is not far from Grand Forks, North Dakota. "Protein content has generally been good. The dry summer has stressed the crop to increase protein levels. Most varieties are coming in at 13.7% to 14.4% protein. Test weights are good also. Although now that the region has had some rain the past week, the wheat is getting discolored and losing some test weight. The harvest in the northern valley has been slow and spotty. August has been cool and humid. That has slowed the final dry-down of the crop. There is still some green heads and straw in fields, making for tough combining. Many farms in the northern end of the valley haven't harvested much if any wheat yet. Moisture content still too high."

"I am about two-thirds done," said Dufault. "Most of what we have harvested has been 14% to 15% moisture, around 14.1 protein and over 60 lb. test weight. The yield has been good. Mid-70-bushel-per-acre range. But not as good as the last two years. Traffic at the grain elevator has been slow. I think the pullback in price has guys binning the wheat. A month ago it looked like a lot of bushels would be sold off the combine."

HOW ARE DROUGHT AREAS DOING SO FAR?

Mark Rohrich, Maverick Ag Inc. of Ashley, North Dakota, said, "Many guys just getting a good start. We are almost finished. Haven't taken a sample to test quality, but looks good. Yielding 50% or less of last year; been in 20s to 40s bpa." Mark's brother, Alan, added, "Have been hearing yields are better than expected; 25 to 45 bushels. Hear a lot of protein in the 16% to 17% range. Most will get just enough to cover the insurance bushels. We finished harvest yesterday, but I drove to Medora and saw lots of fields still standing this week."

Jeff Kittell, merchandiser for Border Ag and Energy of Russell, North Dakota, told me, "In our trade area, early bushels have been better than they were thinking going into harvest; hearing from 40 to 60 bushels per acre. Protein has run anywhere from mid-13% to 16% and looking at an early average of mid-14% pro. Quality so far has been good. We experienced rain showers over last week, and I would think that will have some effect on the color and possibly TW. Spring wheat around Garrison I have heard is running anywhere from 8 bpa to low 30s. Big issue will be how many abandoned acres we have in major drought areas."

Alan Klain of Turtle Lake, North Dakota, said, "We are half done and, surprisingly, yields not great, but better than expected at 8 to 30 bpa. This year looked like 1988 all over again when it was 8 bpa, but better farming practices made the difference. Protein is running 16% to 17%. Some wheat and durum bleaching and now ADM in Hensler and other elevators are checking for falling numbers. Over in the Hazen/Beulah area, they got 4-plus inches of rain, which will likely cause quality problems with any standing wheat."

In northeastern Montana, where drought has yet to let up, Todd LaPlant, elevator manager at EGT, LLC, of Glasgow, Montana, said, "We're about 60% harvested on spring wheat and yields are averaging around 15 bpa. Protein has averaged around 14%, which is somewhat lower than expected with the low yield. We estimate abandonment at around 20% in the Valley County. The good news is that test weight and DHV have been exceptional at 60+ lbs., which is surprising and color is running 80-90 DHV."

An elevator manager in north-central South Dakota told me wheat harvest was finished there with yields in the low-30s on what was harvested, and proteins ran in the mid-14% to mid-15%. He told me harvest lasted 10 days. "It's the quickest and quietest harvest I've experienced in 20+ years."

FINAL QUALITY, YIELDS, PROTEIN STILL UNCERTAIN

The Wheat Quality Council tour during the week of July 24 calculated an average yield of 38.1 bushels per acre for hard red spring wheat. While this is the lowest yield in about 10 years for the tour, it was higher than expected by many producers, considering the severe drought conditions gripping nearly all of western North Dakota.

The North Dakota Wheat Commission (NDWC) agreed that "this overall yield was higher than we anticipated based on weekly crop ratings and producer reports. The final yield result sparked questions and sharp criticism, especially in social media circles." The NDWC acknowledged these concerns from producers, assessing the crop tour yield estimate and clarifying some misinformation in this article found on their website: http://ndwheat.com/…

Between now and the final day of harvest, rain or storms can still change the quality and yield picture in an instant... or not. In the words of Baseball Hall of Fame legend Yogi Berra, "It ain't over 'til it's over!"

Mary Kennedy can be reached at mary.kennedy@dtn.com

Follow Mary Kennedy on Twitter @MaryCKenn

(AG/BAS)

08/22/2017 Tax Reform on the Table

By Chris Clayton
DTN Ag Policy Editor

OMAHA (DTN) -- Donna Funk, a principal for K-Coe Isom out of Kansas, had a tough task last week at the American Coalition for Ethanol annual meeting trying to explain the status of tax reform and the impact on ethanol producers.

Funk was challenged somewhat because there's no legislation to actually point to -- just the goals of the Trump administration and ideas that have been proposed by all sides. Without specifics in hand, Funk was still able to highlight that simply changing tax rates doesn't translate into a positive outcome for businesses. Lowering tax rates likely comes with eliminating some beneficial tax breaks.

"Lowering tax rates doesn't automatically mean lower taxes," Funk said.

Lawmakers plan to return from the August break with big plans to reform the tax code this fall. Both sides of the aisle say they are committed to tax reform, but Funk noted just one problem.

"The parties just don't agree with each other, and right now they don't have agreement within their own party about what the right path is," she said.

Tax reform is critical for the GOP, which is increasingly becoming desperate for a major legislative win before 2018, Funk noted. Yet, of all the issues to tackle, tax reform may be right up there with health care in terms of difficulty to complete. Tax reform is a once-in-a-generation piece of legislation.

"We have not seen tax reform like we are talking about today since 1986," Funk said. "This isn't something that happens very often, and when they do it, they do it in a very big way and it can have a lot of varying effects."

At least some Republican lawmakers also are concerned tax reform could fall victim to a worsening relationship with President Donald Trump. The Washington Post reported last week on key GOP lawmakers who visited former President Ronald Reagan's ranch in part to draw some inspiration as they try to rewrite the tax code.

"At the end of the day, President Trump will be incredibly crucial to the success of this," House Ways and Means Committee Chairman Kevin Brady, R-Texas, was quoted saying in the Post article. "Tax reform is the signature issue of this presidency." (To ready the full Washington Post article, visit www.goo.gl/rreiT9)

Due to a likely lack of support by Democrats in the Senate, Congress may have to use budget reconciliation rules to pass tax reform. A bill would need only a simple majority to pass, but budget reconciliation comes with the caveat that the tax package cannot increase the budget deficit outside the 10-year budget window. This gets into the same kind of short-term extension battles that now encompass dozens of tax credits nearly every year.

One initial question is whether tax reform will have retroactive changes. That may be especially important if Congress is unable to complete a bill in 2017 and the battle carries over to 2018.

"Republicans are still very hopeful they can get something done in 2017," Funk added, "I personally don't think they will get something done in this calendar year."

Funk points to a business deduction such as bonus depreciation that once was approved by Congress in September, but allowed businesses to take advantage of the bonus deduction for purchases back to the beginning of the year. "We've seen it in the past. I think the further we go, the less likely we will have retroactive changes," she said.

There are a lot of up-in-the-air questions, such as how Congress will define the middle class in tax cuts or define "small business." While most farmers may classify as a small business, ethanol plants likely won't meet the definition of "small businesses."

"So if they are focused on helping small businesses, that doesn't necessarily mean they are focused on helping you," Funk said.

Beyond lower corporate rates, lawmakers have to deal with individual, pass-through income for passive and active investors; capital-gains rates; the tax on investment income; Medicare tax; the Alternative Minimum Tax and the estate tax.

"Those last two are both items that could have significant impact on the 10-year budget deficit," Funk said. "My prediction is they won't do away with either one of those. If they do, it will be temporary because I don't think they can come up with enough revenue outside the 10-year period to cover those."

That last statement may shock some farm lobbies that have aggressively championed eliminating of the estate tax even though farm assets make up roughly 2.6% of all assets declared by estates that paid estate taxes in 2015. The bulk of assets in taxed estates are stocks, bonds and cash held by the deceased.

A big issue for businesses is how Congress handles depreciation and immediate expensing. What hasn't been discussed at all is whether immediate expensing is going to be optional or required for businesses. That would essentially get rid of bonus depreciation. So far, there are no guidelines on how much a business could immediately expense, use for bonus depreciation or the kind of businesses -- corporate, partnerships or sole proprietors. Congress has indicated such expensing will not apply to real estate.

"If you are buying land, you are still not going to be able to expense land, but that could change as well," she said.

If businesses are immediately expensing depreciable assets, that leads to the debate about deducting interest on business loans. There is an entire lobby group now -- Businesses United for Interest and Loan Deductibility -- specifically to keep interest deductions in the tax code. Similarly, the real-estate industry has a campaign mounted to defend Section 1031 real-estate exchanges.

"Again, it's more complicated than just how it affects your tax rates because there can be a lot of other ramifications," Funk said. "As we work through these things, if they change that, do we still get this?"

There's debate about discontinuing the concept of net operating losses. The ability to carry forward or carry back a net operating loss could go away. Currently, if farmers or businesses have a loss, they can carry forward the loss or even go back and get a refund on income tax from prior years.

"If that goes away, what does that do to a total cash-flow perspective for somebody over a multiple-year scenario?" Funk said. "If you have a loss this year, you don't get to carry it back or carry it forward. There's no offsetting there, so your cash flow can be impacted."

Other tax credits up in the air include the Domestic Production Activities Deduction (Section 199), a 9% deduction, which affects most manufacturing businesses, including farmers. Another tax credit that could be changed is the Research and Development Tax Credit.

These ties to the various possible changes for businesses led Funk to conclude, "There are a lot of moving parts that I don't think anybody has really stopped to think about. OK, here are all of the things that sound great, but if they put them all together, what does that really look like and what does that mean?"

That is the hard work that still needs to be done, Funk said.

Chris Clayton can be reached at Chris.Clayton@dtn.com

Follow him on Twitter @ChrisClaytonDTN

(AG/BAS)

08/22/2017 USDA Weekly Crop Progress

By DTN Staff

OMAHA (DTN) -- Crop conditions were mostly stable last week with corn condition unchanged from the previous week and soybean condition up just 1 percentage point in the good-to-excellent category, according to USDA's weekly Crop Progress report released Monday.

USDA estimated that 62% of corn was in good-to-excellent condition as of Sunday, Aug. 20, the same as the previous week. That resulted in a DTN Corn Condition Index of 149, up 1 point from the previous week, said DTN Analyst Todd Hultman. DTN's index is still down from 180 a year ago and is close to corn's rating of 148 in 2013. Slight improvement was shown in the Dakotas from a week ago.

Corn progress continued to run slightly behind normal. Seventy-six percent of corn had reached the dough stage, down from 83% a year ago, and down slightly from the five-year average of 77%. Twenty-nine percent of corn was dented, down from 37% a year ago and down from the five-year average of 35% dented.

"Monday's USDA Crop Progress report is neutral for corn," Hultman said.

Soybean progress continued slightly ahead of normal with USDA estimating 97% of soybeans in the blooming stage as of Sunday, down from 98% a year ago and even with the five-year average of 97%. Eighty-seven percent of soybeans were setting pods, which was down from 88% a year ago, but above the five-year average of 85%.

Sixty percent of the soybean crop was rated in good-to-excellent condition as of Sunday, up 1 percentage point from 59% the previous week. That resulted in a DTN Soybean Condition Index of 143, which is up 1 point from the previous week. The index is down from 174 a year ago and is still lower than the past four years.

"Monday's report is neutral for soybeans," Hultman said.

USDA also reported that 58% of spring wheat was harvested as of Sunday, down from 63% a year ago, but above the five-year average of 51% harvested. Thirty-four percent of spring wheat was rated in good-to-excellent condition up 1 percentage point from 33% the previous week. That resulted in a DTN Spring Wheat Condition Index of 34, which is up 3 points from the previous week. DTN's index is down from 155 a year ago and is still the lowest since 1988.

"Monday's harvest progress is neutral for spring wheat prices," Hultman said.

Sorghum was 40% coloring, behind the average of 45%, and mature was 26%, also behind the average of 28% mature. Sorghum harvested was 19%, slightly ahead of the average of 18%. Sorghum condition improved to 66% good to excellent from 64% good to excellent the previous week.

Barley was 70% harvested as of Sunday, ahead of the average pace of 58%. Oats were 78% harvested, behind the average of 83%.

Cotton was 88% setting bolls and 12% bolls opening compared to an average pace of 88% setting bolls and 14% bolls opening. Cotton condition improved to 63% good to excellent from 61% good to excellent the previous week. Rice was 96% headed, ahead of the average of 92%, and 15% of rice was harvested as of Sunday, slightly ahead of the average of 14% harvested.

The following are highlights from weekly crop progress reports issued by National Ag Statistics Service offices in individual states. To view the full reports from each state, visit http://www.nass.usda.gov/…

Colorado

Isolated precipitation was received in several Colorado counties this past week, continuing to provide beneficial moisture but delaying fieldwork in a few areas. In northwestern counties, only spotty moisture has been received. A reporter noted that hay and pasture conditions in several areas are drought stressed, with below normal yields reported for hay. Livestock water for rangeland in these counties remains critically low. Northeastern counties received rain this past week, with heavy amounts reported in areas. Cooler conditions continue to provide relief from dry conditions and seasonal heat. Dryland crops are improving with precipitation, but rangeland is dry in areas and in need of moisture. A reporter noted that a shortage of moisture in weeks prior negatively affected grain fill in some corn. In east-central counties, reports of hail last week were noted, but thus far damage to crops is minimal. In the San Luis Valley, barley harvest is in full swing. A reporter noted that some second-cutting alfalfa remains in the field due to continued rainfall. Southeastern counties also received more rain this past week. A reporter noted recent lack of heat units has slowed progress of crops, notably sorghum. Previous severe weather in southeastern counties continues to affect quality of alfalfa hay harvested. Statewide, harvest of barley and spring wheat was behind last year and the average. Topsoil moisture: 3% very short, 18% short, 75% adequate, 4% surplus. Subsoil moisture: 3% very short, 19% short, 76% adequate and 2% surplus.

Illinois

Drier weather prevailed across most of the state last week. There were 6.3 days suitable for fieldwork during the week. Statewide, the average temperature was 74.2 degrees, 0.2 degree above normal. Precipitation averaged 0.45 inch, 0.41 inch below normal. Topsoil moisture: 9% very short, 41% short, 49% adequate, and 1% surplus. Subsoil moisture: 8% very short, 38% short, 53% adequate, and 1% surplus. Corn dough was at 91%, compared to 88 last year. Corn dented was at 41%, compared to 46% for the five-year average. Corn condition was rated 4% very poor, 10% poor, 32% fair, 42% good and 12% excellent. Soybeans setting pods was at 92%, compared to 88% last year. Soybean coloring was at 4%. Soybean condition was rated 3% very poor, 9% poor, 28% fair, 52% good and 8% excellent.

Indiana

Another dry week has kept irrigation systems running regularly to reduce some of the stress on crops. Few areas across the state received rain, and in many areas the rain was not enough to be beneficial for crops. Portions of west-central Indiana were considered to be abnormally dry according to the U.S. Drought Monitor. The statewide average temperature was 74.9 degrees, 2.1 degrees above normal. Statewide precipitation was 0.36 inch, below average by 0.50 inch. There were 6.3 days available for fieldwork for the week, the same as the previous week. Regionally, corn was 78% in dough in the north, 81% in central, and 86% in the south. Corn was 41% dented in the north, 37% in central, and 43% in the south. Corn rated in good to excellent condition was 56% in the north, 50% in central, and 51% in the south. Soybeans were 87% setting pods in the north, 88% in central, and 83% in the south. Soybeans rated in good to excellent condition were 58% in the north, 51% in central, and 51% in the south. Continued dry and hot weather increased stressors on corn and soybeans, especially in sandy soils and areas without irrigation. The presence of rust remained prevalent in corn fields, along with ear rot and diplodia stalk rot. Soybeans grown in sandy soils began to whiten in the afternoons from the heat. Growers reported that weeds are still growing strong across the State. Other activities for the week included scouting and spraying for pests on corn and soybeans, preparing bins for fall storage, hauling grain and mowing roadsides. Topsoil moisture: 6% very short, 33% short, 58% adequate and 3% surplus. Subsoil moisture: 3% very short, 30% short, 65% adequate and 2% surplus.

Iowa

Much-needed rain fell throughout the state of Iowa last week. Statewide there were 4.8 days suitable for fieldwork. Activities for the week included haying and hauling grain. Topsoil moisture: 19% very short, 31% short, 49% adequate and 1% surplus. Topsoil moisture levels in south-central and southeast Iowa remained over 90% short to very short. Subsoil moisture: 22% very short, 34% short, 44% adequate and 0% surplus. Seventy-eight percent of the corn crop was in or beyond the dough stage, one week behind last year. Twenty-one percent of the corn crop has reached the dent stage, one week behind last year and five days behind the five-year average. Sixty-one percent of the corn crop was rated in good to excellent condition. Eighty-eight percent of soybeans were setting pods, four days behind last year but equal to average. Soybean condition improved slightly to 58% good to excellent. Almost all the oat crop for grain or seed has been harvested. The third cutting of alfalfa hay reached 73% complete, eight days ahead of last year and 10 days ahead of average.

Kansas

Near-normal temperatures were recorded across much of the state last week. Most areas received 1 inch or less of rain, with localized rainfall measuring up to 4 inches in a few southeastern areas. There were 5.1 days suitable for fieldwork. Topsoil moisture: 5% very short, 26% short, 66% adequate, and 3% surplus. Subsoil moisture: 4% very short, 24% short, 70% adequate, and 2% surplus. Corn condition rated 4% very poor, 10% poor, 29% fair, 43% good, and 14% excellent. Corn dough was 83%, near 86% last year and the five-year average of 85%. Dented was 40%, behind 48% last year and 46% average. Soybean condition rated 2% very poor, 8% poor, 35% fair, 49% good and 6% excellent. Soybeans blooming was 95%, near 93% last year, and ahead of 90% average. Setting pods was 79%, ahead of 69% last year and 66% average. Sorghum condition rated 1% very poor, 6% poor, 31% fair, 53% good and 9% excellent. Sorghum headed was 79%, behind 89% last year, but near 77% average. Coloring was 11%, behind 30% last year and 20% average. Sunflower condition rated 2% poor, 33% fair, 57% good and 8% excellent. Sunflowers blooming was 70%, behind 80% last year, and near 72% average.

Michigan

There were 5.4 days suitable for fieldwork in Michigan last week. Timely rains provided moisture stress relief to crops in parts of southern Michigan. However, additional rainfall was needed to expedite crop maturation. Meanwhile, pleasant weather continued further north, which boosted crop progress and conditions. Corn was in mostly good condition in central and northern Michigan, but there was some yellowing of the crop due to lack of nitrogen. The corn crop in southern Michigan was stressed due to the prolonged dry conditions which in turn slowed crop development. This past week's spotty rain events provided slight relief. The rains were also beneficial to soybean development as the crop continued to form and fill pods. White mold was found in some fields and there were a few reports of spider mites, but overall the crop was progressing nicely. Dry beans also had a presence of white mold, which was contained at low levels. Barley, oat, rye and wheat harvests continued toward completion in the northern two-thirds of the state while the sugarbeet harvest was just getting underway in central Michigan. Topsoil moisture: 11% very short, 36% short, 48% adequate, 5% surplus. Subsoil moisture: 12% very short, 31% short, 51% adequate and 6% surplus.

Minnesota

Widespread rainfall limited Minnesota farmers to only 2.6 days suitable for fieldwork last week. That was the fewest days suitable for fieldwork in any week since late May. Activities for the week included harvesting small grains and spraying crops in areas where possible. Topsoil moisture: 3% very short, 12% short, 70% adequate and 15% surplus. Subsoil moisture: 3% very short, 13% short, 75% adequate and 9% surplus. Corn at dough was eight days behind last year. Soybeans setting pods were one day ahead of normal. Spring wheat harvest is eight days behind average. Barley harvest is five days ahead of average. Ninety-two percent of the dry beans were setting pods or beyond, with 8% dropping leaves. Dry edible bean condition rated 73% good to excellent. Sunflower condition remained at 91% good to excellent.

Missouri

Temperatures last week averaged 75.6 degrees, 0.8 degree below normal. Precipitation averaged 1.33 inches statewide, 0.55 inch above normal. Statewide, topsoil moisture supply was rated 9% very short, 24% short, 66% adequate and 1% surplus. Subsoil moisture supply was rated 7% very short, 25% short and 68% adequate. Corn in the dough stage reached 90%, up 5 percentage points from last week. Corn dented reached 64%, up 17 percentage points from last week. Corn condition was rated 61% good to excellent. Soybeans blooming reached 92%. Soybeans setting pods reached 75%. Soybean condition was rated 61% good to excellent. Cotton setting bolls reached 90%. Cotton condition was rated 59% good to excellent. Rice headed was at 90%. Rice condition was rated 61% good to excellent.

Nebraska

Temperatures averaged 1 to 5 degrees below normal last week. Significant rainfall of an inch or more was received across most of the state, while some central counties received up to 6 inches of rain. Topsoil moisture supplies were rated 7% very short, 26% short, 63% adequate and 4% surplus. Subsoil moisture supplies were rated 11% very short, 31% short, 57% adequate and 1% surplus. Corn dough was 83%, near 85% last year, and equal to the five-year average. Dented was 28%, behind 38% last year and 36% average. Corn condition was rated 63% good to excellent. Soybeans setting pods was 89%, near 90% both last year and average. Soybean condition was rated 61% good to excellent. Sorghum headed was 92%, near 94% last year and 88% average. Coloring was 24%, behind 42% last year, but near 23% average. Sorghum condition was rated 66% good to excellent.

North Dakota

Harvest progress was either halted or delayed, as significant rainfall amounts were received over much of the state last week. Moisture amounts ranged from half an inch to over 3 inches. Some hail was received in the western part of the state. Temperatures across the state averaged 2 to 6 degrees below normal. Statewide, topsoil moisture supplies were rated 16% very short, 34% short, 48% adequate and 2% surplus. Subsoil moisture supplies were rated 17% very short, 36% short, 45% adequate and 2% surplus. Corn silking was 98%, near 95% last year and 97% for the five-year average. Dough was 50%, behind 68% last year and 59% average. Dented was 6%, behind 17% last year and 14% average. Corn condition was rated 50% good to excellent. Setting pods was 88%, behind 93% both last year and average. Dropping leaves was 4%, near 5% both last year and average. Soybean condition was rated 47% good to excellent. Soybeans blooming was 96%, near 99% both last year and average. Winter wheat harvested was 85%, behind 94% last year. Spring wheat mature was 94%. Harvested was 52%, behind 61% last year, but ahead of 45% average. Spring wheat condition was rated 35% good to excellent. Barley harvested was 75%, near 74% last year, and ahead of 58% average. Oats mature was 95%. Harvested was 72%, behind 78% last year, but ahead of 57% average. Durum wheat mature was 70%, ahead of 56% last year. Harvested was 19%. Durum wheat condition was rated 11% good to excellent. Canola coloring was 96%, near 93% last year, and ahead of 90% average. Harvested was 17%, behind 29% last year, and near 21% average. Canola condition was rated 40% good to excellent.

Ohio

Temperatures across the state were above normal, while most of the state saw very limited precipitation. While most of the state saw small amounts of rain, some locally heavy rainfalls were observed, mainly in the southwestern and southeastern parts of Ohio. Statewide, topsoil moisture was rated 3% very short, 23% short, 70% adequate and 4% surplus. Subsoil moisture was rated 2% very short, 19% short, 76% adequate and 3% surplus. Corn in the dough stage reached 70%, behind the average of 75%, and corn dented was 16%, well behind the average pace of 26%. Corn condition was rated 60% good to excellent. Soybeans blooming was 95%, behind the average of 98%, and soybeans setting pods was 83%, also behind the average of 89% setting pods. Soybean condition was rated 54% good to excellent.

Oklahoma

Oklahoma continues to experience above normal rainfall, with the statewide average computing to approximately 1.46 inches. Statewide, temperatures averaged in the high 70s. Topsoil moisture was rated 10% short, 79% adequate and 11% surplus. Subsoil moisture was rated 2% very short, 20% short, 72% adequate and 6% surplus. Corn dough reached 85%, up 2 points from normal, and corn dent reached 54%, equal to the normal pace. Corn condition was rated 61% good to excellent. Sorghum headed and coloring reached 79% and 49% respectively, both of which were up 5 points from the previous year. Sorghum mature reached 10%, unchanged from the previous year. Soybeans blooming reached 80%, up 15 points from the previous year while, soybeans setting pods reached 54%, up 7 points from the previous year. Soybean conditions were rated 77% good to excellent. Cotton setting bolls reached 67%, down 9 points from normal, and cotton bolls opening reached 3%, down 1 point from normal. Cotton condition was rated 91% good to excellent.

South Dakota

Much of the state received over an inch of rain last week. The precipitation, along with cooler-than-normal temperatures, provided drought relief to portions of South Dakota. Statewide, topsoil moisture supplies were rated 23% very short, 29% short, 47% adequate and 1% surplus. Subsoil moisture supplies were rated 29% very short, 33% short, 37% adequate and 1% surplus. Spring wheat harvested was 88%, ahead of 74% for the five-year average. Oats harvested was 89%, near 91% average. Barley mature was 92%, near 90 average, and harvested was 45%, well behind 67% average. Corn dough was 65%, behind 75% average, and dented was 13 percent, behind 21% average. Corn condition was rated 42% good to excellent. Soybeans setting pods was 89%, near 88% average, and dropping leaves was 2%, near 4% average. Soybean condition was rated 42% good to excellent. Sorghum headed was 85%, coloring was 22% and mature was 3%, near 1% average mature. Sorghum condition was rated 9% good to excellent.

Texas

Weather was mostly hot and dry in south-central Texas, the Coastal Bend, south Texas and the Lower Valley. The rest of the state experienced cooler temperatures and from 0.2 inch to 2 inches of rain. Statewide, topsoil moisture was rated 9% very short, 24% short, 51% adequate and 16% surplus. Subsoil moisture was rated 10% very short, 28% short, 53% adequate and 9% surplus. Corn was 60% mature, near the average of 59%, and 51% of corn was harvested as of Sunday, ahead of the average of 46%. Cotton was 14% bolls opening and 9% harvested, ahead of the average of 4%. Rice was 70% harvested, well ahead of the average of 52% harvested. Sorghum was 56% harvested, ahead of the average of 52%. Soybeans setting pods were 89%, ahead of the average of 78%, and soybeans dropping leaves was 40%, ahead of the average of 31% dropping leaves. Soybean condition was rated 62% good to excellent.

Wisconsin

Temperatures were close to normal last week, with highs in the upper 70s and low 80s. Rain interrupted fieldwork midweek, with heavy precipitation in the northern part of the state and light or scattered rains elsewhere. In some areas, reporters noted that light and sandy soils were getting dry while in other areas the soil was still wet enough to cause nitrogen deficiencies. Some reporters commented that corn will need a late first frost to reach full maturity. Statewide, topsoil moisture supplies were rated 7% short, 84% adequate and 9% surplus. Subsoil moisture supplies were rated 2% short, 87% adequate and 11% surplus. Fifty-one percent of Wisconsin's corn has reached the dough stage or beyond, two days behind the five-year average. Five percent of the corn has reached the dented stage, six days behind the average. Corn condition was 71% good to excellent, 1 percentage point above the previous week. Eighty-seven percent of the state's soybeans were setting pods, two days ahead of average. Soybeans have just begun to color in the southern part of the state. Soybean condition was rated 74% good to excellent, 1 percentage point below the previous week. Harvesting of oats for grain was reported at 62% complete, eight days behind the average.

National Crop Progress Summary
This Last Last 5-Year
Week Week Year Avg.
Corn Dough 76 61 83 77
Corn Dented 29 16 37 35
Soybeans Blooming 97 94 98 97
Soybeans Setting Pods 87 79 88 85
Spring Wheat Harvested 58 40 63 51
Cotton Setting Bolls 88 80 91 88
Cotton Bolls Opening 12 10 15 14
Sorghum Headed 84 75 88 82
Sorghum Coloring 40 31 51 45
Sorghum Mature 26 21 28 28
Sorghum Harvested 19 NA 16 18
Oats Harvested 78 66 88 83
Barley Harvested 70 52 68 58
Rice Headed 96 91 97 92
Rice Harvested 15 12 16 14

National Crop Condition Summary
(VP=Very Poor; P=Poor; F=Fair; G=Good; E=Excellent)
This Week Last Week Last Year
VP P F G E VP P F G E VP P F G E
Corn 3 9 26 48 14 3 9 26 49 13 2 5 18 54 21
Soybeans 3 9 28 50 10 3 9 29 49 10 2 5 21 54 18
Spring Wheat 23 19 24 27 7 24 18 25 27 6 3 6 25 56 10
Sorghum 2 5 27 56 10 2 6 28 54 10 1 6 28 52 13
Cotton 5 6 26 48 15 8 4 27 44 17 4 14 35 39 8
Rice 1 6 24 54 15 1 6 22 56 15 4 9 26 48 13

Please send comments to talk@dtn.com

(AG)

08/21/2017 Raising a Stink

By Emily Unglesbee
DTN Staff Reporter

ROCKVILLE, Md. (DTN) -- Like a tardy burglar who sneaks in just before dawn, the redbanded stink bug is robbing Southern soybean growers of yield in the final weeks of a hard-fought crop.

"This is the most damaging stink bug out there," warned Louisiana State University entomologist Jeff Davis. Louisiana producers have battled this invasive pest since 2000. They routinely budget three insecticide passes to control it.

In Mississippi and Arkansas, the pest first caused significant damage in 2016. Those soybean yield losses and seed damage are fresh in growers' minds as populations mount again this August.

The frantic questions rolling into Extension offices across these Midsouthern states prompted entomologists to host an emergency meeting Aug. 17 in Stoneville, Mississippi.

THE PEST THAT NEVER ENDS

The biggest problem posed by the redbanded stink bug is its longevity, entomologists explained. It eats only legumes and will infest a soybean crop up until the moment the combine rolls through the field, said Hank Jones, an independent ag consultant in Louisiana.

"One of the things that helps me manage these redbanded stink bugs is knowing that the population is always going to build," explained Jones. "It will never stay the same. It will never level off."

When an infested field is harvested, hungry stink bugs migrate immediately into younger, later-planted soybean fields in enormous numbers.

Even the hardened beans of an R7 soybean plant are no match for the redbanded stink bug's impressive mouthparts. Redbanded stinkbugs cause high levels of mechanical injury by creating a physically larger hole in the bean.

"For comparison, take a McDonald's straw that you drink out of, that's going to be the redbanded stink bug's mouthparts; then take a coffee stirrer, that's going to be your brown, green, and southern green stink bugs," said LSU Extension agent Sebe Brown.

The saliva redbanded bugs release also is much more damaging than their green, southern green and brown stink bug cousins, Davis explained.

The wounds also leave seeds open to secondary diseases and weather damage. Elevator dockage and rejections for stink bug damage were a common problem last year in the Midsouth, and likely will be again, the entomologists noted.

LSU researchers have documented up to 10 bushels of yield loss even in fields sprayed as late as R6.5, mainly from seed weight loss, Davis said. Group IV beans seem to be more sensitive to late-season damage than Group V, he added.

As a result, Davis encourages growers to control the pest as late in the season as possible. Doing so not only saves yield, but it protects neighboring late-planted soybean fields and knocks down populations going into the winter.

Last year's extremely mild winter allowed the redbanded stink bugs to overwinter as far north as Interstate 20 in northern Louisiana, which gave the pest a good head start for 2017.

CONTROL CHALLENGES ABOUND

Redbanded stink bugs do most of their egg-laying and bean-feeding in the lower two-thirds of the canopy, Davis said.

That means scouting with classic sweep nets likely misses a large swath of a population, he said. With that in mind, Louisiana researchers have pegged the "action threshold" at four stink bugs per 25 sweeps of a net.

However, even "sub-threshold" levels can be dangerous if they feed long enough. In 2016, Davis documented a 15-bushel yield loss in a field where just two stink bugs were found per 25 sweeps for three weeks in a row.

"If in the long term, you see populations continue to be there, you need to put out an application because those sub-threshold levels can still cause seed loss and damage," Davis said.

Because the bugs huddle in the lower canopy, insecticide applications often miss the bulk of the population, Davis warned. He urged applicators to slow sprayers down and increase insecticide rates in order to get better control.

Populations with resistance to acephate insecticides have emerged in Louisiana, and they appear to be highly localized but very persistent, Davis added. For data on which insecticides control the pest and at what rates, see page 48 of this Louisiana State University guide: http://bit.ly/….

Guidance on scouting for redbanded stink bugs, which can look very similar to red-shouldered stink bugs, is in his University of Arkansas guide: http://bit.ly/….

FOR NEXT YEAR

The biggest weapon against the redbanded stink bug is out of farmer's control, Davis noted.

"Hope for cold weather," he said. "The lethal temperature is 23 degrees."

Controlling crimson clover, which Davis called "Red Bull for stink bugs," is a close second. The pests thrive and reproduce splendidly in clover fields, which are popular for their cover crop benefits and erosion control along highways and other construction sites, he said.

Some soybean varieties are proving more tolerant to the pest. You can see some of them in this LSU guide, on page 46: http://bit.ly/….

You can view the entire Stoneville, Mississippi, meeting on redbanded stink bug here: https://www.uaex.edu/….

Emily Unglesbee can be reached at Emily.unglesbee@dtn.com

Follow Emily Unglesbee on Twitter @Emily_Unglesbee

(GH/AG)

08/21/2017 Argentina to Accept US Pork

By Chris Clayton
DTN Ag Policy Editor

OMAHA (DTN) -- The White House announced Thursday that Argentina has agreed to accept U.S. pork products for the first time since 1992. The announcement comes after a meeting between U.S. Vice President Mike Pence and Argentine President Mauricio Macri earlier this week.

It's a small prospective market at the moment, but Argentina has had a de facto ban on U.S. pork products for 25 years because of "unscientific mitigation requirements and other sanitary issues that are not based on science," as the National Pork Producers Council states. NPPC had hoped since Marci was elected in late 2015 that his pro-trade stance would open the door to U.S. pork. Argentina has a population of 41 million and higher per-capita income than Mexico.

Under terms of the agreement, all fresh, chilled and frozen pork products from the U.S. will be eligible for export. The White House stated the agreement opens up a potential $10-million-a-year market.

"Today's announcement is a big win for American pork producers and proves that President (Donald) Trump is getting real results for America's farmers and ranchers," Vice President Pence said. "After 25 years of discussions, America's pork producers will soon be able to export their fine product to Argentina. This is one more example of the commitment of President Trump and his entire Administration to breaking down international trade barriers and making free and fair trade a win-win for American workers, farmers, and our trading partners."

Erin Borror, an economist for the U.S. Meat Export Federation, said the $10 million estimate is realistic. Most U.S. pork would likely go into further processed products in Argentina, she said.

"That's where I would imagine that $10 million annual number would come from," Borror said.

The Argentina market is fairly closed. They only import mainly from Brazil with a small amount coming from the European Union. Brazilian exports to Argentina peaked in 2011 at around $155 million in value, but then began declining, mainly because of restrictions by Argentina. The country has started taking in a little more pork.

"The import numbers have bounced around lately," Borror said. "They started to rebound again last year and went up again this year. By my estimates, Brazil could export somewhere around $95 million in pork this year."

A study by economist Dermot Hayes at Iowa State University stated annual pork consumption per capita has increased in Argentina from roughly 1 kilogram in 2005 up to roughly 13 kilograms now. That per-capita consumption is expected to grow, but the country still consumes significantly more beef and poultry per capita. The U.S. might take some market from Brazil, but in reality there is room to grow consumption.

"So U.S. pork would be competing against mostly Brazilian and obviously domestic production, but also in a growing market because that consumption has been steadily increasing," Borror said.

Outside of Argentina, the USMEF reports pork exports to Central and South America were up 51% in volume to 81,930 metric tons and 56% in value to $200.3 million over the first six months of the year, led by growth in sales to Colombia and Chile. Exports doubled to Peru as well. For all of 2016, pork sales to Central and South America reached $335 million and 135,954 metric tons, both record highs.

"U.S. pork producers are the most competitive in the world and we have long sought the opportunity to provide affordable, high-quality pork in Argentina," said Ken Maschhoff, president of the National Pork Producers Council.

Maschhoff thanked Agriculture Secretary Sonny Perdue, Commerce Secretary Wilbur Ross and U.S. Trade Representative Robert Lighthizer, all of whom worked to help compete the agreement.

Maschhoff added, "We also thank Vice President Pence for his efforts, including a recent visit to Argentina, to move a trade agreement that promises significant U.S. economic benefits over the finish line."

Argentina has a 10% tariff on pork imports. Chile and Colombia, because of free trade agreements, do not have tariffs on U.S. pork exports.

Under the agreement announced Thursday, Argentine food-safety officials will visit facilities in the U.S. to verify the U.S. meat inspection system. After that, exports will resume after any pending technical issues are resolved.

Chris Clayton can be reached at Chris.Clayton@dtn.com

Follow him on Twitter @ChrisClaytonDTN

(AG/BE)

08/18/2017 Biofuels Under a Microscope

By Todd Neeley
DTN Staff Reporter

OMAHA (DTN) -- The Renewable Fuel Standard has had an overall positive impact on U.S. agriculture and on the U.S. economy as a whole, a new economic study by Iowa State University shows. However, the policy has done little to reduce greenhouse gas emissions worldwide, and further RFS benefits would come only with the continued expansion of corn ethanol and a reduction in biodiesel production, the study suggests.

The Center for Agricultural and Rural Development at Iowa State University's study, "The Renewable Fuel Standard in Competitive Equilibrium: Market and Welfare Effects," concludes what farmers across the Corn Belt already knew: RFS biofuels mandates have provided price support for both corn and soybeans. The study is slated for publication in the American Journal of Agricultural Economics.

"We find that the RFS has indeed proved to be a remarkably effective tool for farm support," the report said. "Relative to the scenario of no biofuel policies, the 2015 level of mandates entails a 34% increase in corn price and a 9% increase in soybean price. The mandates' impact on energy prices is smaller in absolute terms, with crude oil price decreased by 1.4%."

The policy has boosted the value of the U.S. agriculture sector by $14.1 billion, or nearly $6,800 per American farm.

Without the RFS, the authors found, corn prices would average just $2.75 per bushel in 2015, far below the cost of production.

However, with the RFS, corn prices averaged $3.68 per bushel, or about a 34% increase above the no-RFS scenario.

When it comes to the broader economy in the United States, the study said current RFS mandates when compared to a scenario without the policy, generate a $2.6 billion benefit.

STUDY NEGATIVES

The study also comes to a number of conclusions that could be controversial in rural America.

The analysis said the RFS has little effect on reducing greenhouse gas emissions worldwide.

"The RFS impact on reducing carbon emission, on the other hand, turns out to be nil once we account for the leakage effect (due to the induced increase in the rest of the world's fossil fuel consumption)," the study said.

In January, however, a USDA lifecycle analysis of corn ethanol found GHG emissions associated with corn ethanol in the United States are about 43% lower than gasoline. (For the full USDA analysis, visit http://bit.ly/…).

Geoff Cooper, executive vice president of the Renewable Fuels Association, told DTN the study supports the idea that the RFS reduces GHG emissions in the United States.

"Well, the 'nil' part is misleading," he said. "It (the study) says U.S. GHGs are significantly reduced, but then it argues that international greenhouse gases go up because the RFS makes oil cheaper and the rest of the world uses more oil. So the study suggests U.S. GHG reductions are basically offset by international GHG increases. This is the so-called rebound effect. But, by this logic, the U.S. should not do anything that reduces oil demand or price. So should we abandon CAFE standards, ban electric vehicles and forbid mass transit?"

Among the findings, which are based on an economic model, the best-case scenario would be to increase corn ethanol production and reduce biodiesel production.

"To further improve welfare from the 2015 mandate levels, the model suggests that corn ethanol production should be increased, whereas biodiesel production should be decreased," the study said.

Kaleb Little, senior communications manager for the National Biodiesel Board, said biodiesel has benefitted rural America.

"Created in a bipartisan law, the Renewable Fuel Standard is an effective method to create a renewable-fuels market and related high-value jobs here in the United States," Little said in an email to DTN.

"Countless environmental studies show biodiesel significantly reduces greenhouse gas emissions compared to petroleum diesel, and economic studies show positive impacts on rural communities and U.S. markets, due in part to the diversity of the feedstocks we can utilize. Though the study reinforces crop and livestock producers have benefited from biodiesel production, several assumptions miss the mark, but the track record of the renewable fuels industry and the RFS is clear -- this is a successful program worthy of continued support and growth."

In addition, the authors of the study found that the full implementation of the 2022 statutory RFS volumes to 36 billion gallons by 2022 would be costly and lead to losses in the economy.

ECONOMIC SAVINGS

The analysis found the RFS in 2015 saved the U.S. economy $17.8 billion in gasoline expenses, compared to a no-RFS scenario.

The savings equal about $142 per American household. In addition, ISU said in the study, gasoline prices were 18 cents per gallon, or 9.5% lower because of the RFS, and the policy has bolstered federal tax revenues.

The results highlight how the RFS contributes to domestic energy security.

"The RFS leads to a modest contraction in domestic crude oil production, and a larger decline in imports of crude oil," the authors found.

According to the study, crude oil imports were nearly 200 million barrels lower in 2015 than without the RFS. Meanwhile, domestic crude oil production was only 0.3% lower in "2015 RFS" case than in the "no-RFS" case.

"This new study confirms that American families and our nation's economy significantly benefit from the Renewable Fuel Standard," said RFA President and CEO Bob Dinneen.

"Whether it is lower gas prices, decreased oil imports from hostile nations, a more valuable agriculture sector, or reduced greenhouse gas emissions, this study underscores that the RFS is indeed delivering on its promise and meeting the goals established by Congress when it adopted this seminal energy policy."

Read the full ISU study here: http://bit.ly/…

Todd Neeley can be reached at todd.neeley@dtn.com

Follow him on Twitter @toddneeleyDTN

(AG/BE)