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A Prism Business Media Publication May 3, 2006 | 060503   

TABLE OF CONTENTS
 >> Logan Hawkes

 >> Biggest risk to ethanol margins is price of gasoline

 >> Hu visit leaves trade deficit with China in limbo

 >> Planting delays a concern

 >> Agriculture Road Warrior: Clocking In

 >> News from the Top of the Hill

 >> Corn growers value insect protection technology

 >> Brazil is big in production growth and potential

 >> Soybean rust more a "Southern" problem in 2006?

 >> Electrical conductivity of soil a key to precision farming

 >> Thiesse's Thoughts: Planting Progress Varies

 >> President Bush backs biodiesel

 >> Economic viability of farm sector

 >> Portman appointment may be problem for Doha Round

 >> Former congressman calls subsidies 'obstacle'

 >> Ammonium nitrate fertilizer 'hot potato' for dealers

 >> China on U.S. trade deficit: It's U.S. fault

 >> Sign Up for MarketMaxx

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  EDITOR'S NOTE
Logan Hawkes
05/03/06    Crop News Weekly
If April showers bring May rains then much of drought-stricken America is in for more trouble. Beneficial rains have fallen across parts of the Midwest and in the South, and have even hampered planting in parts of Minnesota and Iowa. But producers in most other areas are still begging for moisture. It could be a hot, dry summer. The summer growing season, by the way, is just around the corner and things are heating up - not just on the farm but in the world of agriculture as well. For instance, the U.S. is not very happy with China trade officials. China blames the U.S. for trade problems. Doha Round has its share of new problems. There's still plenty of debate over a new farm bill on the Hill, and President Bush is now saying ethanol production is part of his plan for energy relief. You see, not all the news is bad.

Elsewhere, the National Corn Growers Association (NCGA) has announced that more than nine out of 10 growers are aware of and effectively complying with Insect Resistance Management (IRM) requirements as mandated by the EPA. The findings are based on 2005 on-farm assessments. Also this week, U.S. soybean rust experts are waiting for the other shoe to drop. After a flurry of confirmed Asian soybean rust findings in January and February, no new findings of the disease have been reported since the first week of March. But that doesn't mean we're out of the woods yet.

There's a lot more in the news this week, so let's get started. Thanks for reading Crop News Weekly.



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  FROM OUR MAGAZINES
Biggest risk to ethanol margins is price of gasoline
05/02/06   
The biggest risk for ethanol producers over the next 10 years is when ethanol prices drop in response to gasoline prices, according to an analysis by the Food and Agricultural Policy Research Institute at the University of Missouri. The report indicated that the price of corn had a lesser effect on ethanol producer profitability. FAPRI, USDA and the Congressional Budget Office all project rapid growth in the amount of corn used for ethanol production through 2016. All three estimate corn use for ethanol at around 1.5 billion bushels for 2005-06, and increasing to over 2 billion bushels by 2007-08. - Elton Robinson, Farm Press Editorial Staff

Hu visit leaves trade deficit with China in limbo
05/02/06   
President Bush's much-anticipated meeting with Chinese President Hu Jintao appears to have done little to address the $202 billion U.S. trade deficit with China or other sources of economic tensions between the two superpowers. Administration officials attempted to put a positive spin on the 90-minute, April 20 meeting, which followed a White House arrival ceremony marked by several incidents that might have been funny if the stakes of the Chinese president's first official visit to Washington hadn't been so high. - Forrest Laws, Farm Press Editorial Staff

Planting delays a concern
05/02/06   
Heavy rains across Southern Minnesota and Northern Iowa that occurred April 28-30 have raised major concerns in some areas regarding delays in corn planting. Most of the region received 2-3 in. of rain over the weekend, which brought total precipitation for April to 7-10 inches in many portions of extreme Southern Minnesota. In some areas, fields have been too wet to plant any corn this spring, while in other parts of southern portions of South Central and Southwest Minnesota, less than 25 percent of the corn is planted, as of May 1. Following the most recent rainfall event, most fields in this region are totally saturated, many fields with standing water, and will take several days of drying to allow spring fieldwork to resume in most locations. - Kent Thiesse, The Corn & Soybean Digest

Agriculture Road Warrior: Clocking In
05/02/06   
Dave Kohl writes: "This is a great quote I heard at the Young Farmer and Rancher Institute sponsored by American AgCredit and Farm Credit Services of the Southwest. When you get the older and younger generations in the same room, you get some interesting quotes. What can be said about the title of this column? Well, one of the reasons why people select agriculture as their career is that there is no set schedule. It is 24-7, 365 days a year." - The Corn & Soybean Digest

News from the Top of the Hill
04/28/06    National Hog Farmer
AG Groups Support Peru Trade Agreement -- The Agricultural Coalition for U.S.-Peru Trade sent a letter to every member of Congress urging them to support the Peru Trade Promotion Agreement (PTPA). The letter said, "The PTPA sets a new and higher standard for future trade pacts. More than two-thirds of current U.S. agricultural exports to Peru will immediately receive duty-free treatment upon entry into force of the agreement. The tariffs on remaining U.S. agricultural products will be reduced over time, with all tariffs eliminated within 17 years." At the present time, approximately 1.5 percent of U.S. agricultural exports to Peru have duty-free access. The letter also stated, that without implementation of the PTPA, "U.S. agriculture will continue to be prejudiced by this non-reciprocal trade and will be forced to compete for business in Peru against countries that already have free trade agreements with the South American nation." The coalition is comprised of 58 organizations including: American Farm Bureau Federation, American Meat Institute, American Soybean Association, National Association of Wheat Growers, National Cattlemen's Beef Association, National Chicken Council, National Corn Growers Association, National Milk Producers Federation, National Pork Producers Council, National Turkey Federation, and U.S. Apple Association.

Mexico Continues Beef Antidumping Duties -- Mexico's Secretaria de Economia has determined that the existing duties on bone-in and boneless cuts of beef produced and exported from the U.S. would remain in effect for an additional five years (April 28, 2010).

Increased Energy Costs -- The high cost of gasoline is getting a great deal of attention in Congress and by the White House. President Bush in a speech to the Renewable Fuels Association (RFA) praised the importance of ethanol and biodiesel. He announced a number of steps the administration is taking to try and provide some short-term relief. They include: 1) halting the purchase of crude oil for the government's Strategic Petroleum Reserve program for the summer; 2) federal tax credits for hybrid and clean-diesel vehicles sold in 2006; 3) Federal Trade Commission to investigate whether there has been manipulation of gasoline prices; 4) ask EPA to use its authority to ease environmental regulations that require the use of cleaner-burning fuel additives for the summer; and 5) ask Congress to approve incentives for research and development to advance more alternative fuels, such as ethanol, biodiesel, and hydrogen.

Energy Legislation -- During the coming weeks we can expect numerous energy bills to be introduced. Various proposals are being discussed including a 60-day suspension of the gasoline tax, wind-fall profits tax on oil companies, investigations of price-fixing, and easing of regulations for refineries. Congressman Jim Nussle (R-IA) has introduced the "Independence from Oil With Agriculture Act." This legislation increases the Renewable Fuels Standard from 7.5 billion gallons to 12 billion gallons by 2012. It also provides for a permanent a tax credit for the installation of E85 tanks. The House Democratic Rural Working Group is calling on Congress to provide tax incentives to encourage increased biofuels production. Congress plans to consider another energy bill before the August recess.

Congress Returns to a Busy Schedule -- Congress returned this week after a two week recess to a very busy schedule. Issues that have been identified by the House and Senate leadership for Congress to considering in the coming weeks are lobbying reform, budget, immigration reform, appropriations, disaster assistance, tax legislation, etc. - Scott Shearer

Corn growers value insect protection technology
05/01/06   
The National Corn Growers Association (NCGA) has announced that more than nine out of 10 growers are aware of and effectively complying with Insect Resistance Management (IRM) requirements as mandated by the Environmental Protection Agency (EPA). These findings are based on 2005 on-farm assessments along with an independent survey conducted on behalf of the Agriculture Biotechnology Stewardship Technical Committee (ABSTC). - Farm Press Editorial Staff

Brazil is big in production growth and potential
04/27/06   
What you have heard about the mammoth increase in production in Brazil during the last decade is either correct or more staggering than you thought. Ditto for their potential growth in the future. Agricultural production in Mato Grosso, the major agricultural growth area of Brazil, is a part of a long-range economic development process that began with (1) a subsistence economy 30 to 40 years ago. The succeeding steps are (2) primary production, (3) establishment of value-added industries, (4) industrial diversification beyond agricultural products and (5) export activities. At the present time they see themselves in the third stage of developing value-added industries like ADM's soybean crush operation and the Feltrin's prototype biodiesel plant. - Daryll E. Ray, Farm Press Editorial Staff

Soybean rust more a "Southern" problem in 2006?
04/28/06   
U.S. soybean rust experts are waiting for the other shoe to drop. After a flurry of confirmed Asian soybean rust findings in January and February, no new findings of the disease have been reported since the first week of March, according to USDA's Soybean Rust Web site. But that doesn't mean U.S. soybean farmers "are out of the woods, yet," says X.B. Yang, Extension plant pathologist at Iowa State University, who is considered one of the top U.S. experts on Asian soybean rust. - Forrest Laws, Farm Press Editorial Staff

Electrical conductivity of soil a key to precision farming
04/28/06   
By knowing the electrical conductivity of their soils, farmers can make more precise management decisions about fertilizer applications, irrigation, use of nematicides, and other pesticide applications, according to Clemson University researcher Ahmed Khalilian. Though it sounds high tech, and the science behind it has been, the use of electrical conductivity, or EC, is really an extension of the good old common sense farmers have been using for thousands of years. - Roy Roberson, Farm Press Editorial Staff

Thiesse's Thoughts: Planting Progress Varies
If you ask someone how much corn is planted and how much spring fieldwork has occurred in their area, the response is likely to be quite different, depending on where the person resides. There are areas where a considerable amount of tillage has occurred and a significant amount of corn has been planted, while in other areas field conditions have been too wet to do any spring fieldwork. Some locations in extreme southern Minnesota have received 6-8 in. of rainfall in April, so soils are totally saturated, and standing water exists in some fields. As of April 21, very little fieldwork has occurred in many parts of the southern portions of South Central and Southwest Minnesota, and the adjacent areas of Northern Iowa. However, as you move north from that area, field conditions have been much more favorable, allowing most of the small grain and alfalfa to be planted. - Kent Thiesse, The Corn & Soybean Digest

President Bush backs biodiesel
04/27/06   
President George W. Bush has touted biodiesel as a key component of his plan to confront high fuel prices. A farmer-leader of the American Soybean Association (ASA) participated in a renewable fuel summit hosted by the Renewable Fuel Association (RFA) April 25 in Washington, D.C., where the President announced his plan. - Farm Press Editorial Staff

Economic viability of farm sector
04/27/06   
"Women school teachers don't need to be paid as large a salary as men teachers because the men have families to support, while women teachers are either single and don't require as large an income, or have husbands and thus their income is a bonus." This is the explanation that we heard many times when we were growing up in the 1950s when female teachers often earned less than their male counterparts teaching the same grade or subject. This argument was made by school board members and citizens alike as they resisted the pressure to pay all teachers according to a common scale: be they male or female, high school or elementary. - Daryll E. Ray, Farm Press Editorial Staff

Portman appointment may be problem for Doha Round
04/27/06   
Does the "lateral" transfer of former Congressman Rob Portman from U.S. Trade Representative to director of the Office of Management and Budget signal a new disenchantment with the Doha Round of WTO negotiations? That was the buzz in Washington after President Bush nominated Portman to replace Josh Bolten, who earlier became White House chief of staff. Susan Schwab, one of Portman's deputies, is getting the nod to succeed Portman. - Farm Press Editorial Staff

Former congressman calls subsidies 'obstacle'
04/26/06   
Cal Dooley's uncle might have been pleased, but it's doubtful many Sun Belt row crop farmers would have been cheering the former California congressman's remarks at the recent USDA Agricultural Outlook Forum. Dooley, who served 14 years representing one of the San Joaquin Valley districts in California, threw down the gauntlet to producers who would like to roll over most of the provisions of the current law into the 2007 farm bill. Turning the argument that 10 percent of farmers receive 70 percent of the farm bill's subsidies on its head, Dooley noted that growers producing nearly 75 percent of the the farm bill's subsidies on its head, Dooley noted that growers producing nearly 75 percent of the U.S. agricultural output today are doing so without those subsidies and "paying a price for our current farm policy. - Forrest Laws, Farm Press Editorial Staff

Ammonium nitrate fertilizer 'hot potato' for dealers
04/26/06   
This summer, farmers and ranchers will find it harder and harder to buy ammonium nitrate, a commonly used nitrogen fertilizer, said a Texas Cooperative Extension expert. Past concerns with nitrogen fertilizer have been linked to the cost of oil and natural gas. This time the shortage has nothing to do with fuel costs, but has originated from fears terrorism. Ammonium nitrate can be used to make bombs such as the one that destroyed the Alfred P. Murrah Federal Building in Oklahoma City in 1995. - Robert Burns, Farm Press Editorial Staff

China on U.S. trade deficit: It's U.S. fault
04/26/06   
It's amazing how accommodating you can be when you're selling someone $200 billion more in goods and services than they're selling you. The Memphis, Tenn., Commercial-Appeal had a big spread in its April 11 editions about a Chinese delegation signing a deal to buy 1.1 million bales from seven U.S. cotton merchants and cooperatives in Memphis. Another Chinese group traveled to Chicago and Minneapolis and bought more than 5 million metric tons of U.S. soybeans. The groups were expected to purchase a total of $15 billion in U.S. cotton, soybeans and poultry. - Forrest Laws, Farm Press Editorial Staff

Sign Up for MarketMaxx
05/03/06   
Sign up and play The Corn And Soybean Digest's fantasy grain game called MarketMaxx. It's easy, fun and hopefully you'll learn a little more about how to market the corn and beans your raise. It's easy to sign-up. Just log on to http://www.marketmaxx.net and register at the top left and begin trading your fictitious 100,000 bu. of corn and 50,000 bu. of soybeans. If you're a winner at the end of the game on October 31 you could take home the grand prize of a year's use of a Massey Ferguson tractor or combine. Or, win additional prizes such as a computer system from Syngenta Crop Protection, customized rugged mobile computers from Grayhill Custom Mobile Solutions or a high-speed satellite Internet service from Agristar Global Networks. - The Corn & Soybean Digest



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