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DTN Midday Grain Comments 04/24 11:11

DTN Midday Grain Comments 04/24 11:11 Grains Mixed at Midday Soybeans lead at midday, while corn and wheat surrender early gains. By David Fiala DTN Contributing Analyst General Comments The U.S. stock market indices are higher with the Dow 195 points higher. The interest rate products are lower. The dollar index is 89 points lower. Energies are lower with crude down $0.45. Livestock trade is mixed with hogs higher. Precious metals are mixed with gold down 12.70. CORN Corn trade is narrowly mixed at midday with trade waiting for the planting progress report this afternoon along with mixed spillover from soybeans and wheat. The weather forecast is expected to bring heavy rains into the middle of the belt this week, but better progress may have been scored late last week, especially in the I states. Ethanol margins should open the week fairly steady. The weekly export inspections were strong at 1.453 million metric tons. The weekly progress report is expected to show planting progress 4% to 6% behind normal with good early week progress possible catching us up more. On the May chart support is at the $3.54 3-month low with resistance at the $3.62 20 and 200-day moving averages. SOYBEANS Soybean trade is 5 to 7 cents higher at midday with the seasonal recovery still trying to build more into the beginning of the week. Meal is $3.50 to $4.50 higher and oil is flat to 10 points higher. South America harvest pressure should be pretty well wrapped up. Trade may be looking to discourage US soybean acreage via lower prices with November futures hanging around $9.50; the area of our six-month lows, but it has been gaining vs. corn the past few days. Basis should remain steady this week seasonally. The weekly export inspections were ok at 634,877 metric tons. Planting progress for soybeans may be issued this week, but it will be a small amount in any event. May soybean chart support is the 10-day moving average at $9.49; with the multi-month low at $9.29 below that, with resistance the 20-day at $9.51 which were above at midday and the 50-day at 10.04 way above that. WHEAT Wheat trade is 1 to 6 cents lower at midday after early strength gave way during the day session yet again despite the weaker dollar and growing world weather concerns. Wheat open interest hit a new record with the liquidation last week, which should induce more short covering if positive finishes can be mounted. Parts of Kansas got fairly cold over the weekend but damage should be limited with heavy rains for much of the belt this week. The Dakotas look wet enough to keep planting slow for now, but progress should be able to catch up in the next week in North Dakota. The European crop looks to struggle with dryness this week along with some concerns building in Russia. The weekly export inspections were good at 612,536 metric tons. The condition report is expected to improve slightly this afternoon with progress remaining ahead of normal, while spring wheat planting will likely remain behind normal, but should have a narrower gap this week. The dollar index is testing the 99 area after the French election. On the May Kansas City contract support is at the new low at $3.98 3/4 with resistance at the $4.19 20-day moving average. David Fiala is a DTN contributing analyst and the President of FuturesOne and a registered adviser. David Fiala can be reached at dfiala@futuresone.com Follow him on Twitter @davidfiala (BAS) Copyright 2017 DTN/The Progressive Farmer. All rights reserved.

DTN Midday Livestock Comments 04/24 12:14

DTN Midday Livestock Comments 04/24 12:14 Triple-Digit Losses Develop in Cattle Trade Cattle markets have quickly moved sharply lower. The losses have adjusted to the increased placement levels seen in feeder cattle numbers on the cattle on feed report. This could add even more uncertainty to the volatile market through the end of April. By Rick Kment DTN Analyst GENERAL COMMENTS: Livestock futures are mixed to mostly lower at midday following a strong push higher in the cattle complex. There is expected to draw additional trade volume near closing bell. Corn prices are lower in light trade. May corn futures are 5 cents lower. Stock markets are lower in light trade. The Dow Jones is 161 points lower while Nasdaq is down 51 points. LIVE CATTLE: Aggressive market pressure has continued to move into all live cattle trade. This has moved through the complex with weakness seen greatest in June and August futures. These contracts have posted $2 to $2.15 per cwt losses, although the rest of the market are also posting triple-digit losses and quickly pulling away from the support seen over the last couple of weeks. Even with the downward movement in the market, it is hard to imagine that the overall tone of the market is turning bearish at this point, as traders continue to focus on the potential of recent market support and some underlying strength that could still move back into the market during the next couple of weeks. Cash cattle trade is undeveloped with bids quiet Monday. Overall show lists are smaller with Texas show lists quite a bit smaller while Nebraska offerings are slightly higher. Overall numbers are slightly smaller than last week. Asking prices are still undeveloped but will likely be more readily available by midweek. Beef cut-outs at midday are mixed, $0.17 lower (select) and up $0.71 per cwt (choice) with light movement of 65 total loads reported (32 loads of choice cuts, 15 loads of select cuts, 10 loads of trimmings, 8 loads of ground beef). FEEDER CATTLE: Sharp losses have quickly moved into feeder cattle futures with the most aggressive pressure seen in deferred contracts. October and November futures are holding losses over $2 per cwt as traders continue to focus on the cattle on feed report which was released Friday. With 111% feeder cattle placed in feedlots compared to an estimated 107.5%, the bearishness of the market could continue through the next couple of days. The overall pullback from the bullishness seen over the last couple of weeks in the cattle markets is also giving to the market pressure. LEAN HOGS: Strong morning gains have developed through nearby lean hog futures trade focusing on short-covering activity. The focus on nearby buyer support helping to draw light support into the complex and cover spreading activity in cattle markets early in the week seems to be the main agenda early in the week. May futures are holding an 80 cent gain, although at this point, any market move is just window dressing given the aggressive downward price moves seen over the last couple of weeks and significant pressure through the complex. There may be some additional follow through buyer support in the market, but unless some support is seen in pork values and the cash hog market, this new found rally will be meaningless. Cash prices are lower at midday on the National Direct morning cash hog report. The weighted average price fell $0.39 at $53.10 per cwt with the range from $49.00 to $54.00 on 3,417 head reported sold. Cash prices are lower on the Iowa Minnesota Direct morning cash hog report. The weighted average price added $0.80 at $52.76 per cwt with the range from $49.00 to $54.00 on 420 head reported sold. The National Pork Plant Report reported 153 loads selling with prices gaining $0.95 per cwt. Lean hog index for 4/20 is at $61.10 down $0.49 with a projected two-day index of $60.49 down $0.61. Rick Kment can be reached at rick.kment@dtn.com (ES) Copyright 2017 DTN/The Progressive Farmer. All rights reserved.

DTN Closing Grain Comments 04/24 14:25

DTN Closing Grain Comments 04/24 14:25 Soybean Meal Leads Ag Contracts Higher July soybean meal was the winner Monday among grain-related contracts and encouraged soybeans higher -- a sign of improved demand. July corn was a little higher while Chicago wheat was a little lower, both looking at forecasts for heavy rains later this week.

DTN Chart Technical Points 04/24 16:30

DTN Chart Technical Points 04/24 16:30 DTN FUTURES 10 4/24/17 SLOW STOCHASTIC PRICES ARE DECIMAL MOVING AVERAGES RSI'S 5 Day 20 Day CONTRACT CLOSE 4-Day 9-Day 18-Day 45-Day 9Day 14Day 30Day %K %D %K %D CBTWT MAY 402.50 408.19 419.17 422.56 433.34 22.51 28.99 38.28 9 9 11 25 CBTWT JUL 419.25 424.13 433.97 436.33 447.67 24.39 30.36 38.91 10 10 15 29 KC WT MAY 401.75 406.44 416.47 419.03 440.23 25.94 29.72 37.15 10 10 10 14 KC WT JUL 414.25 419.13 429.03 431.78 452.49 25.66 29.52 37.08 11 11 10 14 MN WT MAY 521.50 528.06 529.67 529.44 538.16 37.45 39.74 42.87 10 30 43 44 MN WT JUL 531.50 536.94 538.22 537.43 545.14 39.37 41.29 43.95 10 30 47 49 CORN MAY 359.25 358.94 363.39 362.97 366.21 42.45 43.96 45.99 17 11 28 49 CORN JUL 365.50 365.44 370.11 370.14 373.52 40.47 42.58 45.34 17 11 25 47 CORN SEP 372.50 372.75 377.19 377.40 380.42 39.53 42.05 45.17 17 11 24 46 OATS MAY 218.75 219.06 220.44 221.63 236.86 38.85 37.92 41.82 29 26 13 16 OATS JUL 217.75 217.25 219.19 219.31 231.99 39.76 38.57 42.10 21 17 14 18 BEANS MAY 961.25 952.31 950.11 948.58 987.49 56.73 47.43 42.60 59 48 31 27 BEANS JUL 971.75 962.44 960.61 959.31 997.49 56.69 47.55 42.76 58 47 30 26 BEANS AUG 973.25 963.88 962.31 961.25 998.67 56.57 47.49 42.82 58 47 28 25 S MEAL MAY 316.40 311.17 312.20 311.09 322.61 57.73 50.99 46.62 35 23 32 30 S MEAL JUL 320.60 315.33 316.43 314.98 326.11 58.21 51.65 47.16 34 23 33 32 B OIL MAY 31.69 31.78 31.51 31.59 32.46 48.93 46.22 43.76 73 70 29 21 B OIL JUL 31.93 32.00 31.73 31.84 32.73 48.95 46.11 43.66 75 71 28 20 CATTLE APR 129.00 129.09 126.93 123.31 119.97 78.92 75.39 68.32 83 87 93 94 CATTLE JUN 114.85 115.99 115.33 113.07 110.16 59.11 61.98 62.09 51 65 84 88 FEEDER APR 138.25 138.34 138.17 135.56 130.73 65.32 64.89 62.35 44 53 86 87 FEEDER MAY 137.45 139.19 138.95 135.66 130.26 56.29 60.63 61.39 26 45 76 84 HOGS MAY 64.40 64.28 66.43 67.86 71.25 29.74 30.78 36.37 15 10 7 7 HOGS JUN 69.53 69.12 71.01 72.02 75.13 34.41 35.30 39.35 17 10 7 8 COTTON MAY 80.09 79.21 77.34 76.34 76.83 69.57 64.79 59.45 82 84 85 68 COTTON JUL 78.79 78.89 77.90 77.44 77.91 60.58 57.29 55.42 85 86 83 64 RICE MAY 9.60 9.82 10.00 10.04 9.84 21.02 31.62 41.87 5 8 30 56 RICE JUL 9.88 10.09 10.27 10.30 10.10 21.12 31.81 42.23 5 7 30 56

DTN Closing Livestock Comment 04/24 16:42

DTN Closing Livestock Comment 04/24 16:42 Cattle Futures Crash In Reaction to Record March Placement Triple-digit losses rocked cattle futures thanks to long liquidation and bearish reaction to larger-than-expected March placement activity confirmed on Friday. On the other hand, nearby lean hog futures bounced significantly higher.

DTN Early Word Grains 04/25 05:56

DTN Early Word Grains 04/25 05:56 Planting Progress Gives Prices Pause July corn was down 1 3/4 cents, July soybeans were down 4 1/2 cents, and July Chicago wheat was down 1 3/4 cents. By Todd Hultman DTN Analyst 6:00 a.m. CME Globex: July corn was down 1 3/4 cents, July soybeans were down 4 1/2 cents, and July Chicago wheat was down 1 3/4 cents. CME Globex Recap: July corn and soybeans were modestly lower early Tuesday after USDA reported 17% of corn and 6% of soybeans planted. Chicago wheat was also a little lower with a slight increase in Monday's winter wheat crop rating. OUTSIDE MARKETS: The Dow Jones Industrial Average closed up 216.13 points at 20,763.89. The NASDAQ Composite was up 73.30 points at 5,983.82 and the S&P 500 was up 25.46 points at 2,374.15 Monday. DJIA futures were up 53 points early Tuesday morning. Asian markets were higher with Japan's Nikkei up 203.45 points (1.1%), Hong Kong's Hang Seng up 316.46 points (1.3%), and China's Shanghai Composite up 5.04 points (0.2%). European markets were mostly higher Tuesday with London's FTSE 100 up 8.67 points (0.1%), Germany's DAX down 3.20 points (-0.03%), and France's CAC 40 up 7.09 points (0.1%). The U.S. dollar index was down 0.09 at 98.95 while the June euro was up 0.00370 at 1.09235. June 30-year T-Bonds were down 19/32nds at 152'27 while June gold was down $5.30 at $1,272.20. June crude oil was up 0.10 at $49.33 while June Brent crude was up $0.05 at $51.65. Soybeans at the Dalian Exchange were lower overnight and Malaysian palm oil futures are down 1.7%.

DTN Early Word Opening Livestock 04/25 05:57

DTN Early Word Opening Livestock 04/25 05:57 Hog Futures Set to Open Moderately Higher Look for lean hog issues to open moderately higher, supported by follow-through buying and bottom-picking interest. The cattle complex is geared to begin with mixed prices thanks to residual selling and short-covering. By John Harrington DTN Livestock Analyst Cattle: Steady Futures: Mixed Live Equiv $146.05 +.47 * Hogs: Steady Futures: 50 -100 HR Lean Equiv $79.84 - .98** * based on formula estimating live cattle equivalent of gross packer revenue ** based on formula estimating lean hog equivalent of gross packer revenue GENERAL COMMENTS: Feedlot country should be generally quiet Tuesday as bids and asking prices remain poorly defined. Both sides are understandably wondering if Monday's board crash was just a one-trick pony or a significant sign regarding a market top. Live and feeder futures seem staged for a mixed opening tied to a combination of follow-through selling and short-covering.

DTN Cattle Prices 04/25 09:15

DTN CATTLE PRICES/TRENDS 04/25 09:15 HEAD SOLD LIVE STEERS DRESSED LIVE HEIFERS DRESSED KANSAS NEBRASKA TEXAS IOWA COLORADO *=PRIVATE SOURCES DTN COMMENTS: The cash cattle trade remains unestablished this morning with both bids and asking prices poorly defined. Significant activity could be easily postponed until Thursday or later. Beef cut-outs are expected to be higher today with light to moderate box movement. Live and feeder futures are bouncing higher through the opening hour, supported by short covering and cash premiums. Feedlots are encouraged to call DTN with any cattle sales, at 1-800-369-7675, 1- 402-399-6402, or 1-402-462-8897. All sales will be listed anonymously and organized by state. General trends and summaries from this data will also be posted on the Daily Sales Reported to DTN page.


 DTN Headline News


March for Science

By Emily Unglesbee
DTN Staff Reporter

WASHINGTON (DTN) -- The rain didn't deter the thousands of protesters who streamed into the nation's capital on Saturday, April 22, to join the March for Science.

They wrapped their signs in plastic, donned ponchos and marched on as the clouds alternated between drizzle and downpour. Among the many attendees were agricultural scientists from industry, government and academics.

One such scientist, an employee in the pesticide re-evaluation division of the EPA, protected her "Show Me the Data" sign with an umbrella.

"Overall, it seems the tenor of politics now is that facts and data are less important and science is less important, as is investment in basic research and science," she told DTN. She declined to be identified for fear of reprisal.

She said everyone in the agency is worried about the dramatic budget cuts proposed for the EPA.

Ohio State entomologist Kelley Tilmon said these very fears helped spur her trip from Wooster, Ohio, to D.C. "One of the reasons I'm here is for the scientists who can't be," she said.

She joined Michigan State University Extension entomologist Chris DiFonzo, who traveled from East Lansing, Michigan, to represent ag scientists in the March.

They huddled under a tree near the Washington Monument, as steady showers dampened their "Make America Cogitate Again" signs.

"Many people forget that agriculture is 100% based on science," DiFonzo told DTN. "Farmers are on the front lines of science, every day."

Similar marches occurred around the world on Saturday in 600 cities from Los Angeles to Berlin.

Before they marched up the Mall to Congress in D.C., the crowd massed around a rally stage next to the Washington Monument. Speakers ranging from science educator and television presenter Bill Nye to Roger Johnson of the National Farmers Union spoke in defense of science-based policy and investment in public research.

The role of scientists as educators was on prominent display. A group of white "teach-in" tents were set up near the stage. Inside, scientists gave mini-lectures on topics such as archeology, climate change, bee health and ocean conservation.

The signs of many marchers called attention to the dramatic budget cuts proposed for scientific institutions like the USDA and EPA. One man with a bushy white beard and a lab coat held up a black sign with red lettering declaring "No Science Funding = No Future." Another marcher's sign read, "Fund EPA: Prevent Silent Spring."

Both Tilmon and DiFonzo expressed concerns over the budget cuts proposed for EPA and USDA, particularly rural outreach programs. "I think a lot of people underestimate what government programs do for them," DiFonzo said of the agricultural community.

The EPA has a bad reputation among many farmers, but staff cuts could endanger farmers' access to safe and effective pesticides, Tilmon added.

Many marchers focused on climate change science, which has been called into question by members of the current administration, including the head of the EPA, Scott Pruitt.

Tilmon and DiFonzo worry that ignoring climate change at a policy level could hurt farmers first. "Of all the industries affected by climate change, agriculture is a huge one," DiFonzo said.

"Farmers live and die by when the next rains come," Tilmon added. "So they're living this -- they're seeing the changes."

Not everyone at the March for Science was a scientist. Software developer Mark Pemburn and his wife, Leanne, who works in insurance, made the trip from Baltimore, Maryland, simply to show their support for scientists.

"Without science, I would not have my work," Mark pointed out.

Leanne said she was discouraged by what she called "the cluelessness" and "indifference" to facts in the current administration.

"We're forgetting how much we have gained from science," she said.

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

Follow Emily Unglesbee on Twitter @Emily_Unglesbee


Cash Market Moves

By Mary Kennedy
DTN Basis Analyst

Spring wheat planting was behind in five of the key growing states as of April 16, with Idaho and Washington significantly behind, followed by Minnesota and then North Dakota and Montana, according to last week's USDA Crop Progress report. If you look at a map of 2017 spring wheat final planting dates, parts of Idaho, Washington and Montana are three weeks away from their final insurance plant dates. Rain is expected in Washington through the rest of the month, and some estimate prevented-planting acres could be 10% to 15% as their last plant date nears. Northwestern Minnesota is experiencing cold temperatures and a rain/snow mix as of April 24, which will also stall planting.

North Dakota NASS noted that as of April 16, in the northern part of the state where large amounts of snow were received this winter, muddy soils still exist. Some isolated areas in northeast North Dakota were still experiencing some flooding. Six inches of snow fell in the same area as of April 23, with more expected in the Northern Valley to start the week. Also, most of the western half of the state, including Jamestown and north, is under a winter weather advisory as of April 24.

I talked to farmers and elevator managers in Montana, North Dakota and South Dakota to find out how planting, or the lack thereof, is progressing. South Dakota is, so far, the only winner, with 52% of their spring wheat planted, ahead of the five-year average of 44% as of April 16. In the Aberdeen, South Dakota, area, one farmer said he was 100% finished planting, and another said he has all 1,700 acres planted. Others said they were done a couple weeks ago, and acres are 40% less than last year. Another farmer said he has been done for about a week and a half, but didn't plant a lot.

"Spring wheat planting is over one-half done and should finish this week," said Jerry Cope, who does the grain marketing for Dakota Mill & Grain, Inc. in Rapid City, South Dakota. "Predicted rains may slow the finish, but it is early for most crops, so not sure that there will be as big of a push to switch, at least not for another week to 10 days. Low prices now, a low price outlook and, in some cases, stress getting lines of credit renewed makes it harder than ever to predict acres. However, western South Dakota farmers like to plant wheat, so I am going to guess unchanged to down no more than 10% with a wide margin of error! On the bright side, timely rains are getting planted crops off to a good start."

Todd Yeaton, manager of Gavilon elevator in Kimball, South Dakota, said, "We have 70% of last year's acres and 90% of the spring wheat is in the ground in our area."

Ryan Wagner, Wagner Farms in Roslyn, South Dakota, told me, "We started last Saturday and, after a few short delays, finished up Monday, the day after Easter. For the most part, the guys that are still growing spring wheat around here only planned on seeding a field or two for straw or a place to put manure, so most only had a day's worth of seeding to do anyway. We got a nice 0.5 inch of rain on top of everything after planting was done, so it should get off to a good start."

Heading north of the border to North Dakota, the stories are much different than their southern neighbors. Allan Rohrich, Rohrich Farms in Zeeland, North Dakota, farms with his brother and father. He told me that they are about 50% planted on spring wheat but were shut down by showers early in the week. "Looks like we may see some more tomorrow that will keep us out of the field 'til close to the weekend. Planting has been slow around the area, mainly because I don't think there is much wheat going to be planted."

Brad Thykeson, of Portland, North Dakota, said, "Pretty slow to start. There are pockets of seed in the ground, but north of Highway 2, it will be closer to May."

Matt Powell of Hope, North Dakota, said there will be no planting for a week in Hope. Ola Lindell of Jamestown, North Dakota, said they were at least a week away if they have decent weather. And Josh Ostenson of Finley, North Dakota said, "Haven't turned a wheel yet." A farmer in Binford, North Dakota, said he didn't know of anyone in that area that has seeded any spring wheat.

Keith Brandt, general manager of Plains, Grain and Agronomy in Enderlin, North Dakota, told me late in the week, "Local area maybe has close to 25% of this year's spring wheat planted. Was in the Mott, North Dakota, area midweek; 70% to 80% of the wheat planted. Acres are down 25% from last year. While 80% to 90% of last year's crop is marketed, there is no new crop on the books."

Jeff Kittell, a merchandiser at Border Ag & Energy in Russell, North Dakota, said, "Nothing has been done in area north of Minot; we still have snow in tree rows, but we may see some NH3 going down later this week. I have heard some wheat has been planted in Garrison area."

Paul Anderson, a farmer in the Coleharbor, North Dakota area, which is near Garrison, told me that he has to plant peas and lentils first before he can start wheat.

Dave Kjelstrup, who farms near Underwood, North Dakota, said that "Planting is underway but kind of slow. Lots of wet spots in the fields, so you have to pick where to seed. Wheat planting is going to be way down, obviously because of the price. We are only putting in close to 700 acres; starting on it the end of the week. I don't think farmers around here are going to plant much wheat, and not a lot has been planted to date. I talked to a farmer from Mohall yesterday, and he has not gotten his seeder out yet and probably won't till May."

"Spring wheat planting has started, but not by everyone," said Tim Dufault, who farms in the Crookston, Minnesota, area. "West Central Minnesota and southern Red River Valley got started last week. They are drier. Less of their total acreage base is HRS, so many on those farms might be done planting. Western Minnesota and eastern North Dakota saw rains Monday and Tuesday. That southern area saw from 1 to 1.5 inches of rain. That will stop them for a few days. Northern RRV had less rain, a trace to .75 inch, but that area was wetter to start with."

Dufault continued, "In the Crookston area, maybe a third of the growers have planted wheat, usually on drier ground like last year's sugar beet ground. In the Crookston area, maybe a third of the growers have planted wheat, usually on drier ground like last year's sugar beet ground. I thought I could start Monday night (April 17), but I was wrong. Fields still have areas that are too wet to make a good seed bed. But I think after the 0.5 inches of rain we had, I should be able to go by the weekend."

In Big Sandy, Montana, some farmers were busy seeding wheat, peas and safflowers. In the Golden Triangle, located in central Montana, wheat seeding is slightly behind normal, according to a farmer who spoke to me. He said he estimated they are a week or so behind, but he expects "Lots of acres of DNS (dark northern spring wheat) to be planted." The three points of the Golden Triangle are Havre, Conrad and Great Falls. In the heart of the Golden Triangle, Chouteau County is the largest wheat-producing county in Montana.

With fewer acres predicted to be planted in the U.S., any planting delays or the inability to get the crop in before insurance dates pass will be a concern for millers, exporters and end users. And while Canada is predicting a rise in spring wheat acres, according to the most recent Stats Can report, weather problems have plagued growers there as well.


Minimal planting has taken place on the prairies to date, with some activity reported in southern Alberta and in southwestern Saskatchewan, DTN Canadian Grains Analyst Cliff Jamieson said. "Prairie temperatures are expected to remain below normal into early May, while southern Manitoba is dealing with the aftermath of spring flooding while the northern areas of Alberta have seen recent spring snow."

"Friday's Statistics Canada report shows farmers bucking the global trend when it comes to expected acres planted to wheat, after both the United States and Australian governments reported fewer acres seeded to the crop. In total, producers are expected to seed 23.2 million acres of all-wheat (includes durum and winter wheat remaining), slightly higher than the upper end of pre-report expectations, down just 0.1% from 2016-17 and only 1.2% below the 10-year average. By class, an expected 8.2% increase in spring wheat varieties to 16.7 ma comes close to offsetting the 16.9% drop in durum acres to 5.145 ma, which is still 2.9% higher than the 10-year average," Jamieson said.

"Interestingly," Jamieson said, "this is the same year-over-year percentage drop for durum expected on both sides of the border. As well, the estimated winter wheat remaining is pegged at 1.373 ma, down 15.1%. Geographically, eastern Canada's producers are expected to trim wheat acres by 8.3%, mostly winter wheat, while prairie farmers are expected to increase planted area of all-wheat by 80,000 acres or 0.4%."

The area that is expected to boost spring wheat acres is Alberta, where, according to Stats Can estimates, acres will increase 10% to 7.4 million. Maybe so, but Alberta is still trying to harvest up to 1 ma of farmland left in the field last fall because of poor weather halting harvest attempts. On top of that, snow fell over the Easter weekend in central Alberta, further delaying farmers' ability to harvest and plant. Plus, even more snow has been falling since Easter in the northern areas of the province. Time will tell how that all plays out as far as farmers' ability to increase spring wheat acreage.

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

Follow Mary Kennedy on Twitter @MaryCKenn


Pruitt Pressed on Ethanol


By Todd Neeley
DTN Staff Reporter

WASHINGTON (DTN) -- Citing federal data that shows ethanol cracked through the blend wall in 2016, the Renewable Fuels Association on Monday asked U.S. Environmental Protection Agency Administrator Scott Pruitt to keep the Renewable Fuel Standard on track for corn-based ethanol in 2018.

RFA Chief Executive Officer and President Bob Dinneen said in a letter to Pruitt that obligated parties in the RFS including importers and refiners respond when there is certainty in federal policy.

"Over the past 18 months, obligated parties have shown that they can readily achieve compliance with RFS requirements if EPA's annual RVO (renewable volume obligations) rulemakings remain faithful to congressional intent, are published on schedule, and provide certainty to the marketplace," Dinneen wrote in the letter.

"Accordingly, we respectfully ask that EPA ensures the 2018 RVO rulemaking process remains on schedule, and that the 2018 conventional renewable fuel volume requirement remains at the statutory level of 15 billion gallons."

The blend wall is when total ethanol production exceeds the E10 market.

Some legislative proposals have suggested there is a need to cap ethanol in gasoline at 9.7% to account for the blend wall. The ethanol industry has expressed concern about such a cap, saying it could lead to corn-ethanol plant closures.

Recent data from the U.S. Energy Information Administration shows gasoline consumed in 2016 contained 10.04% by volume, suggesting there is not a need for a 9.7% cap.

"In fact, the data show that national average ethanol content was 10% or higher in six of the last seven months of 2016, culminating with a record-high monthly rate of 10.3% in December 2016," Dinneen wrote in the letter to Pruitt.

"Compelled by the RFS and favorable blending economics, growing consumption of E15, mid-level ethanol blends (containing 20% to 50% ethanol) and flex fuels (containing 51% to 83% ethanol) was responsible for the increase in the average ethanol content of U.S. gasoline last year. Your commitment to timeliness and certainty in the RVO rulemaking process will allow this evolution of the marketplace to continue in 2018."

In the letter, Dinneen pointed to Pruitt's own words during recent Congressional hearings on his nomination to lead EPA.

"We agree with your statement during the recent Senate Environment and Public Works Committee's confirmation hearing that EPA's past failures to meet the statutory deadlines for issuing RVO rules 'create(d) great uncertainty in the marketplace,'" the letter said.

"When affected parties under the RFS are provided with regulatory certainty and sufficient lead time for planning, they have consistently demonstrated an ability to adapt their operations and comply with the standards."

Dinneen pointed to the ethanol industry's reaction to the EPA's delay in releasing RVOs for 2014 to 2016 as an example of the industry's flexibility to react to the market.

"While 2014 had passed and 2015 was nearly over when EPA finally published the final rule for 2014-2016 RVOs in November 2015, obligated parties, renewable fuel producers, and other stakeholders had sufficient time to react and implement compliance strategies for 2016," Dinneen said.

"The result, as documented in a recent analysis by the University of Illinois, was slight over-compliance with the 2016 RFS volume requirement and growth in surplus stocks of certain Renewable Identification Number (RIN) credits."

In addition, the final rule for 2017 RVOs that set the conventional renewable fuel requirement at the statutory level of 15 billion gallons was published on schedule in November 2016.

"This provided obligated parties and renewable fuel producers with ample time to plan and implement strategies that will facilitate compliance with this year's standards," Dinneen said.

"Ethanol producers have ramped up production and are on pace to produce a record supply of 16 billion gallons of conventional renewable fuel in 2017, well above the 15-billion-gallon conventional renewable fuel RVO. Meanwhile, refiners and blenders have upped their inclusion of ethanol in U.S. gasoline, with average blend rates hitting a record weekly level of 10.4% in mid-January."

Dinneen said ethanol producers have proven petroleum industry concerns about not having the proper infrastructure in place to account for expanded ethanol production were unfounded.

"Because the final 2016 and 2017 RVOs were published on schedule, the marketplace has responded and obligated parties have shown that the so-called 'blend wall' is not a real barrier to RFS compliance," he writes.

Read the letter to Pruitt here: http://bit.ly/…

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

Follow him on Twitter @toddneeleyDTN


EPA Head at Earth Day Texas


By Chris Clayton
DTN Ag Policy Editor

DALLAS, Texas (DTN) -- Speaking at an Earth Day Texas forum Friday, Environmental Protection Agency Administrator Scott Pruitt refuted the notion his agency would sit idle under President Donald Trump's watch. He also challenged the argument that President Barack Obama's administration was good for the environment.

Pruitt pushed back on the comments of a few protestors who disrupted his event and attacked Pruitt's environmental record as Oklahoma attorney general, as well as his stances on issues such as climate change.

"When you look at the past administration, I ask you to consider something," Pruitt said. "Ask yourself, what did they achieve in terms of environmental outcomes?"

Pruitt cited that roughly 42% of the country doesn't meet EPA ozone standards, affecting roughly 140 million people. The number of Superfund sites -- locations that have been designated with contaminated soil from industry -- is at 1,322 such places and grew under President Obama, Pruitt said. Then there was less investment for water infrastructure, leading to situations such as the lead contamination in Flint, Michigan.

"So I ask you, this past administration, where are their outcomes that are so good?" Pruitt said. "But yet here we are beginning our term and we're trying to set a new path forward of actually having objectives we can all count and measure and provide outcomes that are tangible to the American people."

Pruitt spoke at Earth Day Texas, a three-day affair at the Texas State Fairgrounds that includes major speakers, entertainment and exhibits. It's the largest Earth Day event in the country, and to best describe the event, it's the chamber of commerce meets the environmental movement.

That cross of business types blending with green idealism creates natural conflicts. That was reflected as three different people disrupted Pruitt's forum by shouting out comments on climate change and problems they believe EPA is ignoring in Texas. One protestor shouted that Pruitt sued EPA to prevent improvements in air quality when he was in Oklahoma. Pruitt countered, "We had 13 or so lawsuits against the EPA as I was attorney general. The Sierra Club has sued the EPA a lot more than I have over the years, largely because of non-compliance and EPA not doing their jobs historically."

Pruitt characterized environmental improvements over the last four decades as a partnership between the states, industry and the federal government, though the administrator declined to acknowledge that industries nearly always resist any change reducing such pollutants. Instead, Pruitt pointed to the economic growth the country has seen while cutting back pollution over that time.

"I think what's happened over the last several years is we've been told we have to choose between jobs and protecting the environment," Pruitt said. "And I think that's a false choice."

Pruitt noted he had spent part of the week in Chicago looking at Superfund sites and had visited a coal plant in Missouri. He said his tour was "about getting back to the basics with respect to the mission of EPA. And to that end, we're really trying to set some metrics and objectives to achieve measureable outcomes in some key areas."

Regarding air quality, Pruitt said too much of the country is at "non-attainment" for EPA's standards for ambient air quality. "We can do better than that," Pruitt said.

Looking at the Superfund sites, Pruitt said some sites have been on the EPA clean-up list going back 30 to 40 years. Pruitt said those sites should be considered a priority for clean-up.

"Some of those sites, like the one I visited this week in east Chicago, have been on that list for quite some time," Pruitt said.

Pruitt also pointed to the national problem of water infrastructure, citing the most egregious example, Flint, Michigan, and its lead problem. Pruitt noted, however, there are communities around the country with poor water infrastructure that need repair.

"If we can get back to basic core missions in each of these key areas in air, land and water, and obviously it's something we want to do to ensure that the partnership with the states is preserved as well," Pruitt said.

Pruitt also noted that Trump's infrastructure plan, which is still in the works, would include significant investment to upgrade municipal water-treatment infrastructure.

One of the fundamental problems with EPA, Pruitt said, has been a breakdown in the federal-state partnership at EPA in its core mission areas. "There's been an attitude, a displacement if you will, of regulators at the state level partnering together to achieve good ends," Pruitt said. "Who wants that?"

Pruitt cited that EPA issued five federal implementation plans under the Clean Air Act in the three presidents prior to President Barack Obama. Pruitt said the Obama administration issued 56 such plans. "Now that says something. That says there's an indifference or an attitude of displacement with respect to states," Pruitt said. "I believe the regulators in Texas care about the air they breathe and the water they drink, and we need to partner with them to achieve good outcomes and not try to displace them."

Pruitt took questions from Ryan Sitton, a Republican member of the Texas Railroad Commission. Sitton said there is a misperception all Republicans hate regulation, and he asked Pruitt to define good regulation and bad regulation.

"Regulation, and this is a very profound statement, regulations ought to make things regular," Pruitt said. "Because those who are regulated want to know what is expected of them. And I think what has happened over the last couple of years is something I've referenced as regulatory pancaking."

Pruitt said EPA has a problem with issuing a rule and then two years later coming out and issuing another rule in a different section of the Clean Air Act that strands an investment or displaces the rule made two or three years prior.

"So you have industry out there investing capital to achieve good outcomes, and then in a short time frame, that will all be erased," Pruitt said.

Not every Republican at Earth Day Texas was enamored with Pruitt's approach on the environment. Andrew Sabin, chairman of Sabin Metal Corp., is both a Trump supporter and an environmentalist. Speaking to reporters Saturday, Sabin called Pruitt "the worst EPA person known to man." Sabin said climate change should be framed as a matter of public health in terms of asthma, pediatric care and lifespans.

"All of these fixes for health are the same as you have for climate change," Sabin said. "Some of the regulations he (Trump) is cutting are affecting public health."

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

Follow him on Twitter @ChrisClaytonDTN


Growing Organic


By Richard Oswald
DTN Special Correspondent

LANGDON, Mo. (DTN) -- Charlie Johnson, 59, has been an organic grower for four decades, raising certified organic crops on his 2,500-acre farm near Madison in southeastern South Dakota.

It's a lot of work fighting the weeds and doing a lot of cultivating each year until the crop has canopy closure.

"It gets kind of old, but when you see $7.50 (per bushel) corn, it's not so bad," he said.

In 1981, Charlie and his younger brother Allan divided the operation they shared with an uncle. They assumed their father's 560-acre half interest when he suffered a debilitating stroke.

Since then, the farm has grown and they own 1,400 acres and rent 1,100. As with any business expansion, there are growing pains. "We've taken on more acres, so we've had to go through the (certification) process on those," Charlie told DTN.

It takes three years to transition conventionally farmed land to being fully certified organic.

"It's been a while since we had to transition new land, but typically we do a year of oats and two years of alfalfa. Oats the first year are not certified, so they go into a separate bin and are fed to livestock. Our cattle are not organic production, so that's OK."


Charlie has been an organic grower since 1976 when organic "was pretty much self-proclaimed." He and Allan persevered through the 1980s when certification officially began, and in the 1990s when USDA organic standards were established.

Charlie's long-time work in organics received recognition from the Midwest Organic and Sustainable Education Service. He received the 2013 MOSES Organic Farmer of the Year award for his "stellar environmental conservation, simple yet powerful organic production practices, and years of community leadership," according to the organization.

In many ways, Charlie and Allan's farming operation resembles a typical South Dakota livestock and grain farm. They have 175 Black Angus/Gelbvieh cross cows, along with pasture, corn, soybeans, oats and alfalfa.

That's where the resemblance stops.

Typical commercial fertilizers or pesticides are not used. Manure from the cowherd, and poultry litter pellets applied through a tractor-drawn spinner spreader, are the only fertilizers they apply to crops.

How do they keep weeds under control? Crop rotation helps limit pests and improve fertility, and there's a secret weapon: "We cultivate like heck," Charlie said.

In order to stay ahead of emerging broadleaf and grassy weeds, it takes two or three passes with a rotary hoe. Charlie and Allan have four rotary hoes. "You've got to hoe early and often," Charlie said.

Then they do another two or three passes with a row-crop cultivator. The Johnsons have three of those. Corn fields are "dragged" with a springtooth harrow prior to emergence, about four days after planting. "That takes care of a lot of early grass," Charlie said.

This is not a minimum-till or no-till farm. Fields are prepped for planting with a DMI Tigermate field cultivator after a fall pass with a chisel plow equipped with points. The Johnsons have several tractors, both large and small, starting with a Case IH Steiger 350 four-wheel drive, and ending up with a Deere 6600.

"We're not partisan on our farm. We go between red and green (machinery brands)," Charlie said.

With so much intensive cultivation, does Charlie use state-of-the-art GPS-reliant equipment found on so many farms today? His technology is as "organic" as his crops: "My right eyeball and my left arm are my guidance systems," he said.


There's more to weed control on this farm than cold hard steel. Every acre is rogued by hand for big weeds, such as sunflowers, prior to crop canopy. A crew of Hispanic workers do a lot of that work, passing through on their way to jobs where they detassel seed corn fields.

"We have footprints every 60 inches in every field," he said, meaning one man weeds by hand two rows at a time. "They come from Mexico on work visas, and are supplied by a broker who first advertises for local labor to fill those jobs," Charlie explained. He added it's important that the crew arrives before detasseling starts, because that's the primary reason they are in the U.S., to provide labor no one else will do.

Charlie contracts directly with the broker who supplies a crew, their transportation, food and lodging. "They come up in spring and have to be out of the country by September. We try to go over the corn starting in June and finishing up by the Fourth of July. Hispanics do about three-quarters of our corn and soybean acres," he said.

However, hand labor doesn't stop there. Charlie also hires and leads a crew of high school students for the same purpose. "By the end of the year, we've been over every acre," he said.

For conventional farmers experiencing disparities between high input costs and low commodity prices, improved yield becomes the guiding light.

Charlie is quick to point out that labor-based weed control has its own high cost. "Those kids walking the rows, cultivation, and a six-year oat, alfalfa, alfalfa, soybean, corn, soybean rotation are my pesticides."

But dryland yields of 150 bushels per acre for corn, 40 to 45 bpa for soybeans, and 85 to 90 for oats work, especially when organic price multiples are two to three times what conventionally produced grains fetch.

Still, prices aren't what they were a few years ago when Charlie sold corn for $13 compared to today's prices of $7.50 to $8.00.

"On our corn I try to budget 120 bushels at $8. On soybeans, it's 40 bushels at $20. Overall, I want to see $600 per acre gross income. Costs will run about $500," he said.

"Obviously for me corn is my highest value crop just like it is for conventional farmers. Corn and soybeans generate two-thirds of my income. I try to manage the lower value crops so that in the end I have that overall average income of $600 per acre."


Other than alfalfa and wheat straw sold to a small local organic dairy that markets directly to consumers in the Sioux Falls area, everything the Johnsons grow is sold out of state.

National Farmers Organization merchandises their grain -- generally about 70 to 80 trailer loads weighing 50,000 to 60,000 pounds each -- to producers in Wisconsin, Iowa, Minnesota, Nebraska, and sometimes North Dakota.

"In the last 10 years, I have not had a semi unloaded in South Dakota. There are maybe a half dozen organic dairies in the entire state. Wisconsin has 700. They are smaller farms by nature in Wisconsin. There are organic dairies of 30 or 40 cows relying on farmers like myself to supply their feed.

"There is just more of that mentality there, whereas in our part of the country we say they go CAFO chasing. We call it the I-29 model. We keep losing cow numbers in South Dakota as numbers concentrate in fewer and bigger herds," Charlie told DTN.

He said it would be nice to get that kind of production from smaller organic dairies like those in Wisconsin going in his state. "Those smaller dairies are profitable. They're getting $35 to $40 per hundred (pounds) for their milk," he said. That compares to perhaps $20 per hundred for regular whole milk.


Cattle are a natural fit for organic farmers like Charlie, because they utilize alfalfa hay production he needs to complete organic rotations, and provide fertilizer for his fields.

A few of the Johnsons' calves are sold direct to local consumers for beef. Most are sold as feeder cattle. Charlie holds back about 30 bred heifers every year.

Cows run on about 500 acres of permanent pasture, eating grass six to nine months out of the year. "With the harsh winter climate up here, we keep them close," Charlie explained.

Tree groves and outbuildings in nearby pastures help break winter winds and drifting snow. That's where manure is collected and formed into windrows, where natural heating kills weed seeds. Windrows are stirred, and eventually manure becomes a fluffy fertility builder, easily picked up and spread with a manure spreader at the rate of 15 to 20 tons per acre on designated fields.

Organic farming requires patience, attention to detail -- and work -- like no other. That is no less true when transitioning the farm across generations. One advantage organic farming offers family farmers is that technology and larger equipment still haven't displaced labor and man-hours.

But have today's lower commodity prices stifled the Johnson brothers' farm? It doesn't seem so, because Charlie and Allan's 37-year-old brother, Kevin, a Case IH mechanic by training who now works on red or green machinery, is coming back to the farm.

Between the two of them, Charlie and his wife Bette have five grown children. The youngest, Jordan, 26, works a part-time job in town and still helps out around the farm.

In the past, Kevin and Jordan have worked on the farm. Now they'll provide labor and investment for a share of the crop.

All it takes is time.

"I foresee that in five or six years we'll be equal partners each sharing 25%. In the meantime, they're going to need to keep their part-time jobs," Charlie said.

Richard Oswald can be reached at talk@dtn.com


Crop Tech Corner

By Emily Unglesbee
DTN Staff Reporter

ROCKVILLE, Md. (DTN) -- This bi-monthly column condenses the latest news in the field of crop technology, research and products.


In the past two weeks, USDA's Animal and Plant Health Inspection Service (APHIS) has released documents on proposals to release two genetically modified (GM) organisms: diamondback moths and a virus designed to control the citrus greening disease attacking the citrus industry.

Diamondback moths are a global pest of cruciferous crops such as broccoli, Brussel sprouts and cabbage. On April 18, USDA released a draft environmental assessment of a proposed experiment by a Cornell entomologist with GM diamondback moths. The scientist, Anthony Shelton, plans to release tens of thousands of GM moths into a 10-acre vegetable field to test their potential as an "insecticide-free" control option for diamondback moths. The GM moths have been engineered to repress female survival, known as a "female autocidal trait." They also express a protein that makes them glow red, to help researchers distinguish them from wild diamondback moths. After the experiment, researchers would kill the moths with insecticide. Any escapees would eventually perish in the cold New York winters. Here is the USDA's environmental assessment of this experiment, which concludes that it would have no harmful effects: https://goo.gl/….

Citrus greening has devastated the citrus industry around the world, as well as in the U.S. Once infected, citrus trees stop producing any edible fruit. The disease is caused by a bacteria and has no known cure. Attempts to develop GM citrus trees that are resistant to it has been met with public outcry. Now a Florida nursery, Southern Gardens Citrus Nursery, is proposing the release of a GM virus, Citrus tristeza virus, which has been engineered to express bacteria-fighting proteins found in spinach. The GM virus, which has been undergoing controlled field tests since 2010, would be grafted -- not sprayed -- onto citrus trees in Florida. USDA has announced its intent to launch an environmental impact statement on Southern Garden's proposal. You can see it here: https://goo.gl/….


Mycotoxins are a problem for grain farmers around the world. Now researchers from a Dutch university are working with a large team of scientists, engineers and IT specialists from government, academia and industry in 10 different European countries and China to tackle the problem of controlling mycotoxin contamination. The university, Wageningen University & Research, is developing an "e-toolbox," which pulls together techniques from every step of the farm-to-table process, from seed selection to post-harvest monitoring systems and new baking techniques that lower mycotoxin infection. The toolkit aims to empower all levels of the grain industry, from farmers to bakers and legislators, to monitor and reduce the incidence of mycotoxin in crop production and food supply chains. The goal is to reduce crop losses from mycotoxin contamination by at least 20% and up to 90%. See the e-toolbox here: https://www.mytoolbox.eu/….

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

Follow Emily Unglesbee on Twitter @Emily_Unglesbee.


Field Work Roundup

By Emily Unglesbee
DTN Staff Reporter

ROCKVILLE, Md. (DTN) -- From Missouri to Minnesota and in between, many planting efforts are stalled thanks to cool, soggy conditions. Farmers are finishing up burndown and pre-emergence herbicide sprays as well as fertilizer applications.

Jeff Littrell, who farms with his son in southeast Minnesota, summed up the Corn Belt's status after a long drive to St. Louis.

"We get to see lots of farm country, and this trip down was very odd this year with very little if any activity going until the Macomb, Illinois, area," he told DTN in an email.

There are pockets of productivity, of course. With two-thirds of their corn seed in the ground, Scott Wallis' operation in southern Indiana is humming right along. And over in Virginia, Stephen Ellis has finished planting full-season soybeans and is nearing the end of his corn planting.

Most growers told DTN they were actively applying herbicides and fertilizer or wrapping up these field-prep activities. Some expressed concerns at growers who have rushed to get herbicide applications on in questionable conditions, especially given the strict labels for new dicamba herbicides.


On Monday, USDA estimated that corn planting across the country had slowed to 6%, behind the five-year average of 9% and half of the 2016 pace of 12%.

"It's been a variable week for rainfall across the Midwest," noted DTN Senior Ag Meteorologist Bryce Anderson. One to 2 inches have fallen on the northern and western Corn Belt, with a drier trend favoring the south-central and eastern areas, such as central Illinois through Indiana and Ohio, he said.

Farmers from eight Corn Belt states told DTN via email that they were waiting for warmer and drier soils to start planting.

Ohio farmers Keith Peters and Jan Layman haven't seen much corn going in the ground in central and west-central Ohio, respectively. Over in northwest Indiana, Randy Plummer has seen "next to nothing planted," and the planters are still parked where Gerald Gauck farms in the southwest corner of the state.

It's too cold for most corn growers' tastes in North Dakota, farmer Dave Kjelstrup noted. But at least one Michigan grower expects planters to start rolling next week.

"As an agronomist and farmer, I am worried about this corn that is in the ground," added Jay Magnussen, who farms in northwest Iowa. He estimates 5% to 10% of corn has been planted in his area.

"We have had an inch of rain in the last two days and corn seeds taking in 40- to 45-degree rainwater will see imbibitional chilling and stand loss," he said of conditions early in the week.


Lots of sprayers have been moving across the Midwest. Growers from Ohio, Indiana, Illinois, Michigan and Missouri said cover crops and winter annual weeds were the primary targets of herbicide applications. Fields where fall herbicide control didn't happen have proved problematic.

A handful of growers told DTN they have had to practice patience while waiting out windy conditions in March and April before they could spray.

Some may be moving too fast, warned Brian Corkill, of Galva, Illinois. He posted a picture on Twitter on April 15 of a grower running a sprayer as winds speeds clocked in at "a sustained 28 mph."

Corkill and many fellow farmers on Twitter expressed concerns that ignoring herbicide labels, especially the highly restrictive ones for new dicamba herbicides, is a dangerous game this season.

"Just because there aren't any 'crops' up, doesn't mean there aren't other sensitive plants to worry about, plus it's just plain wrong," Corkill told DTN.


Growers are still spreading fertilizer, mostly in the form of ammonia, in Iowa, Ohio, Indiana and Illinois, farmers told DTN. Corkill has just finished up his nitrogen applications in northern Illinois. Over in Indiana, Plummer took some time early in the week to give his triticale a second shot of nitrogen.

All are eager to move on to the spring season's most critical step: corn and bean planting.

"I will be planting hard when it dries and the sun comes out," Magnussen said.

"All ready to hit the field to plant as soon as it is fit!" added Corkill.


Editor's Note: Consider entering our DTN/The Progressive Farmer #MyPlanting17 Photo Contest from now until May 21 for a chance to win some great prizes.

Entering is easy, but please limit yourself to one entry per month. For all the details, visit: http://bit.ly/…

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

Follow Emily Unglesbee on Twitter @Emily_Unglesbee


New Iowa Nitrogen Plant Opens

By Russ Quinn
DTN Staff Reporter

WEVER, Iowa (DTN) -- Amidst fertile Mississippi River Valley farm fields here, the first greenfield nitrogen fertilizer production facility built in the U.S. in more than 25 years officially opened for business Wednesday.

Iowa Fertilizer Company (IFCo) and its Egypt-based parent company, OCI N.V., unveiled their Wever, Iowa, plant, which will produce 1.7 million to 2.2 million tons of nitrogen products annually. The plant will produce ammonia anhydrous, urea and UAN solutions and can alternate between products.

Due to changing economics in producing nitrogen fertilizer with the ready supply of natural gas found in the Bakken region, many companies, and even commodity groups, decided they would build nitrogen-producing facilities over the last decade. The Bakken region encompasses parts of Montana and North Dakota in the U.S. and Saskatchewan and Manitoba in Canada.

However, the reality of raising enough money to cover construction costs, as well as increasing building costs over the years, prevented most groups from ever getting plans off of paper and moving soil. Several existing nitrogen-producing facilities were rebuilt and began to produce increased amounts of nutrients in recent years. But the IFCo plant marks a significant accomplishment in the fertilizer industry.


Nassef Sawiris, CEO of OCI N.V., told those attending a ribbon-cutting ceremony Wednesday that the day marked an important change in the nitrogen market in North America.

"The start of production at Iowa Fertilizer Company plant in Wever is a transformative moment for the agricultural industry," Sawiris said. "We couldn't be happier to be part of this community which supported us."

Larry Holley, president of Iowa Fertilizer Company, said that the domestic production of nitrogen is good news for the farmers of Iowa and Illinois as well as those farmers across the Midwest. Locally produced nitrogen will lower costs associated with transporting fertilizer, he said.

"This is the most innovative, safest, environmentally-friendly plant ever built," Holley told those in attendance.

Daily maximum product capacities at the Wever facility call for 4,750 tons of UAN solution, 1,320 tons of granular urea and 2,425 tons of ammonia. In addition, the facility will also produce diesel exhaust fluid (DEF) at a daily maximum capacity of 990 tons.

Yearly production will be at least 850,000 tons of ammonia, 460,000 tons of granular urea and 1.7 million tons of UAN solution.

Sawiris noted the plant, which is located in southeastern Iowa just across the river from Illinois -- the No. 1 and No. 2 corn-growing states -- houses both a world-class production facility as well as a top distribution center. That fact was evidenced by several semitrucks and trailers hauling ammonia that entered and exited the facility during a tour of the grounds.


New nitrogen facilities like the Iowa Fertilizer Company plant don't come cheap. IFCo invested more than $3 billion to build their sprawling new facility near Wever, an unincorporated village of about 700 in northeastern Lee County in extreme southeastern Iowa.

The facility was built in part with funds from the largest tax incentive package in Iowa history, with $1.4 billion coming from the state. Some in the Hawkeye State criticized the amount of the package given to the company.

Despite the high price tag and controversy over public funds, the new plant is poised to be an economic lift for southeastern Iowa, and specifically Lee County.

Iowa Gov. Terry Branstad and Lt. Gov. Kim Reynolds spoke at the ribbon-cutting ceremony, and both pointed to a region needing an economic shot in the arm.

"Six years ago, we started this process and we decided Lee County was the place it was needed as it had the highest unemployment rate in the state at 9.9%," Branstad said.

According to a press release from IFCo and OCI, since the groundbreaking, unemployment in the country dropped from 8% to 5.3%. At the peak of construction, more than 3,500 workers were building the facility.

IFCo will employ a full-time staff of more than 200 workers. Annual payroll is set at $25 million, and $25 million will be spent in maintenance.

Reynolds, who is set to become Iowa's governor once Branstad is confirmed as U.S. ambassador to China, called the plant and region a perfect match.

"Lee County was overlooked in the past as it struggled during the tough economic downturn," Reynolds said. "This will draw dividends for decades."

Russ Quinn can be reached at russ.quinn@dtn.com

Follow him on Twitter @RussQuinnDTN


Senator Hears Cattle Concerns

By Chris Clayton
DTN Ag Policy Editor

MALVERN, Iowa (DTN) -- Iowa Sen. Joni Ernst told cattle producers she has her own concerns about the Trump administration's trade agenda as producers highlighted topics they would like to see addressed in the next farm bill.

Ernst, a first-term Republican, told DTN she expects a quick vote on USDA Secretary nominee Sonny Perdue on Monday when senators return to Washington. Ernst said that, unlike for nominees for other cabinet posts, Democrats had agreed to waive the 30-hour debate and go right into a vote to confirm Perdue. "That's the first vote we will take when we get back to Washington, D.C.," she said.

Sitting down with local cattle producers in southwest Iowa on Wednesday, Ernst expressed concern about renegotiating the North American Free Trade Agreement. She noted NAFTA "has been very beneficial" for Iowa, mainly due to agricultural exports. Farm-state senators want to encourage the Trump administration when it comes to agriculture, "for lack of a better term, not throwing agriculture under the bus."

Some bilateral trade deals likely can be worked out, but they won't come quickly given that President Donald Trump's full trade team isn't in place. That requires getting Perdue and U.S. Trade Representative nominee Robert Lighthizer on the job. Ernst told the cattle producers she has concerns about Lighthizer's knowledge and background when it comes to agricultural trade. Lighthizer is more comfortable dealing with manufacturing issues, she said.

"I will just be very blunt about this," Ernst said. "I don't know he's as well-informed about agriculture as I think he should be in promoting those products overseas. So we will have to be vigilant and make sure that is top-line when he is engaging in trade. We will have to make sure the people working under him know how important this is for us."

Producers told the senator they were concerned about the state of international trade as well. Will Frazee, a local cattle feeder near Emerson, Iowa, reminded the senator that exports amount to $250-$275 per head of cattle right now. "We would like to increase that, of course, but we don't want to lose what we have, either," Frazee said.

Regarding the farm bill, price discovery was raised as an issue by David Trowbridge, manager of Gregory Feedlots Inc. in Tabor, Iowa. Trowbridge said the Mandatory Price Reporting program is important for cattle feeders, but more transparency is needed regarding larger packer trade and prices from feed yards in the southwest.

"We need to look at that and get some more transparency in that program" Trowbridge said.

Sen. Charles Grassley, R-Iowa, is introducing his bill to ban packer ownership of cattle. Trowbridge said more balance in reporting sales and prices of cattle trade would be better than banning the packer ownership. "I think the better deal is opening up more transparency in that market," Trowbridge said.

Ernst agreed, indicating she likely isn't with her Senate colleague on a ban. "I do think there is probably a different avenue we can take," she said.

Will Longinaker, a younger farmer and cattle producer from Randolph, Iowa, told the senator that younger producers such as himself are struggling to compete for acreage. He was concerned about acres going into the Conservation Reserve Program, given higher rental rates compared to lower commodity prices. Longinaker said landlords are putting land into CRP that should be in production.

"I know that maybe not more regulation, but a closer look is needed for land going into CRP that would help younger producers have an opportunity to find acres," Longinaker said.

CRP is drawing a lot of attention with suggestions to raise the 24-million-acre program cap, but Ernst said Longinaker's views were "spot on." CRP, she said, needs to go back to its intent of protecting land from soil erosion and degradation. CRP was not meant to be a retirement program. Ernst said the number of acres put into the program should be examined, as should the requirements for those acres.

"We have seen whole farms put into CRP," Ernst said. "And that's a nice retirement program for somebody, but that's not what it was intended to do."

Jim Gregory, owner of Gregory Feedlots, told the senator she was "dead on" when it came to CRP. Gregory said the program should be changed to allow for grazing, perhaps with a reduced payment, as a way to keep some land in pasture that shouldn't be planted into crops anyway.

"We have got to figure out a way to keep it in grass, but maybe they can have some livestock on it," Gregory said. "Pay them accordingly."

Others at the event talked about protecting crop insurance for farmers and the need to address how agencies such as the Army Corps of Engineers balance the needs of people versus endangered species. Ernst noted that was a big concern for farmers along the Missouri River bottom now battling the Corps over levee issues.

Ernst told DTN briefly afterward that the biggest topic she has heard in most farm bill discussions around Iowa is the need to protect crop insurance and keep it in the farm bill. Ernst added that the House is moving more quickly on farm bill hearings and work as the Senate will be tied up dealing with a lot more confirmations and nominees for Trump administration posts in the coming months.

Ernst also briefly touched on President Trump's budget proposal, indicating she wasn't certain about the prospects of some proposed cuts. "Understanding what the president proposed in his initial budget is maybe not reflective of what we'll end up doing in Congress," she said.

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

Follow him on Twitter @ChrisClaytonDTN


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