Illinois FarmWeek July 12 2010

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Monday, July 12, 2010 Two sections Volume 38, No. 28

FarmWeek on the web: FarmWeekNow.com Illinois Farm Bureau®on the web: www.ilfb.org

A MADISON COUNTY fam-ily is concerned about the impactreturn of the “death tax” next yearcould have on the family’s farmingoperation. ........................................4

PROPOSALS TO PROHIBITbiotech crops within Midwest wildliferefuges is frustrating to producersdeprived of other key agronomictools. .......................................................9

MIDWESTERN SENATORSare joining forces in an effort to kickdown the 10 percent ethanol blendwall. Illinois Sen. Dick Durbin isamong those involved in the fight. ..5

NICE AND EASY

Jesse Jansen of Montrose carefully maneuvers a 1911 Case 110-horsepower antique tractor off atrailer last week during the opening day of Historic Farm Days in Penfield. The steam-powered go-liath is owned by Jansen’s father, Bill, of Dieterich. More than 1,000 antique tractors and farm imple-ments were displayed during the four-day show. (Photo by Daniel Grant)

BY KAY SHIPMANFarmWeek

Illinois’ financial shape onJune 30 was its worst ever,and the state must set aside“a large portion” of thisyear’s revenues just to payoff last year’s debts, accord-ing to a July report fromComptroller Dan Hynes.

“Illinois ended the fiscal

year in the worst fiscal posi-tion in its history,” the“Comptroller’s Quarterly”report stated.

At the end of June, thestate owed $4.7 billion com-pared to the $2.785 billionthe same time a year ago.

Not only had the debtgrown, but so had the waitfor those owed state pay-ments — another dubiousrecord.

By June, the paymentdelay had increased to 153working days, up from 99days the previous year.

“As a large portion of thefiscal year 2011 revenuesmust be set aside to pay theprior year’s bills, paymentdelays over the course of thenext (fiscal) year are likely tobe even more prolongedthan what was seen in fiscalyear 2010,” the report said.

If last fiscal year’s rev-enues are any indication, theoutlook is grim at best.

Corporate income taxeswere down 20.5 percent or$350 million; sales taxesdropped 6.9 percent or $465

million; and personal incometaxes fell 7.7 percent or $712million.

With reasonable revenue

performance but no signifi-cant changes to the currentbudget, “the state will likelyend fiscal year 2011 with a ...

bill backlog significantlyhigher than that at the endof fiscal year 2010,” thereport concluded.

State ends fiscal year 2010 in the worst shape ever

Bipartisan duo seeks window for estate tax reformBY MARTIN ROSSFarmWeek

With Congress heading intoa pre-election home stretch,prospective estate tax reform-ers must “break the logjam”before once-exempt farmheirs find themselves againliable to Uncle Sam, a FarmBureau analyst warns.

U.S. Sens. Blanche Lincoln(D-Ark.) and Jon Kyl (R-Ariz.) are seeking their oppor-tunity to move a plan thatwould place a new $5 millionper individual/$10 million percouple exemption on theestate tax.

The House late last yearapproved “permanent” exten-sion of the tax at a 45 percentrate on all assets inherited

above $3.5 million per individ-ual or $7 million per couple.Unlike the House plan, theLincoln-Kyl bill proposesadjusting exemptions annuallyto track with the rate of infla-tion.

The measure includes a 35percent top tax rate and

“stepped-up basis,” enablingheirs to take the fair marketvalue of an estate for capitalgains purposes and pay capitalgains tax on the differencebetween the net sales price

and that stepped-up basis ifand when they sell assets.

“(Lincoln and Kyl) need avehicle — they need some-thing to amend the plan to,”American Farm Bureau Feder-ation policy specialist PatWolff told FarmWeek. “It’skind of a case of wait-and-be-ready. Once they have a bill toamend this to, the vote willhappen fast.

“Right now in the Senate,there aren’t 60 votes for any(estate tax) proposal. If theHouse bill came up in theSenate, it wouldn’t pass. Thereare people in the Senate whowant to do more than whatthe House bill did.”

The senators had hoped toattach an amendment to the

Senate version of a smallbusiness package that recentlycleared the House, but col-leagues already had “filled thetree” with other tax breaksand incentives, Wolff said.

Meanwhile, Sens. SheldonWhitehouse (D-R.I.), TomHarkin (D-Iowa), and BernieSanders (I-Vt.) have unveileda so-called Responsible EstateTax Act which would imposea new 10 percent “billionaire’ssurtax” on estates worth $500million per individual andrestore 2009’s $3.5 millionexemption with a 45 percentrate on estates up to $10 mil-lion.

The Whitehouse-Harkin-Sanders bill would allow“family farmers” to reduce the

value of their land for estatetax purposes by as much as $3million, indexed for inflation,under the tax code’s Section2032A “special use valuation”clause.

Today, eligible heirs canreduce farmland values by $1million.

Farm Bureau supportsunlimited special use valua-tion, and Wolff held that is “astep in the right direction.”But although she noted2032A is a potentially valu-able tool particularly in areaswith “inflated land values”such as those abutting majorcities or national parks, spe-cial use valuation carries a

FarmWeekNow.com

See Estate tax, page 4

Listen to Pat Wolff’s commentson current estate tax legisla-tion at FarmWeekNow.com.

FarmWeek Page 2 Monday, July 12, 2010

(ISSN0197-6680)

Vol. 38 No. 28 July 12, 2010

Dedicated to improving the profitability of farm-ing, and a higher quality of life for Illinois farmers.FarmWeek is produced by the Illinois FarmBureau.

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© 2010 Illinois Agricultural Association

STAFFEditor

Dave McClelland ([email protected])Legislative Affairs Editor

Kay Shipman ([email protected])Agricultural Affairs Editor

Martin Ross ([email protected])Senior Commodities Editor

Daniel Grant ([email protected])Editorial Assistant

Linda Goltz ([email protected])Business Production Manager

Bob StandardAdvertising Sales Manager

Richard VerderyClassified sales coordinator

Nan FanninDirector of News and Communications

Dennis VerclerAdvertising Sales RepresentativesHurst and Associates, Inc.P.O. Box 6011, Vernon Hills, IL 600611-800-397-8908 (advertising inquiries only)

Gary White - Northern IllinoisDoug McDaniel - Southern IllinoisEditorial phone number: 309-557-2239Classified advertising: 309-557-3155Display advertising: 1-800-676-2353

Quick TakesECONOMY

AG PLATE BENEFITS — Christmas came early for Illi-nois Agriculture in the Classroom (IAITC), thanks to agricul-

ture specialty license plates. SusanMoore, IAA Foundation director,recently received $50,000 for IAITCprograms and activities based on theanticipated number of specialty ag

plates in circulation.“It’s an amount that will continue to grow as vehicle owners

renew their plates,” Moore said. Last year, the specialty platesgenerated $10,000 for IAITC. Plates were first offered in2007-08.

Moore thanked Steve Simms and Illinois Farm Bureau’spromotions team for initially collecting signatures to supportthe issuance of the plate. She noted that many Farm Bureauand Country Financial vehicles are outfitted with ag specialtyplates, as well as those purchased by individuals.

BAD POLICY? — Sixteen U.S. senators, including biparti-san Ag Committee leaders, have chastised USDA’s planned $6billion in crop insurance cuts.

Senate Agriculture Committee Chairman Blanche Lincoln(D-Ark.) voiced support for increasing and improving cropinsurance coverage at the committee’s first 2012 farm billhearing.

“If we could get every farmer in this country to 85 percentrevenue insurance that is affordable, we would go a long wayin filling the holes of the current safety net,” she said.

But Lincoln and colleagues are concerned expanding futurefarm coverage will prove more difficult if USDA slashes fund-ing in its standard reinsurance agreement (SRA) for companiesthat sell federal crop policies. Insurers must sign the agree-ment this month to continue offering coverage.

“We remain concerned that the $6 billion in proposed cutsover the next 10 years to the program reflected in the SRAwill severely constrain the (Congressional Budget Officespending) baseline for the farm bill,” Sen. Saxby Chambliss(R-Ga.) and others said in their letter to USDA.

TRADE PROGRESS AND PRIORITIES — In itsprogress report on the recently created national export initia-tive, the White House last week cited improved advocacyefforts on behalf of U.S. exporters, increased access to exportfinancing, greater efforts to remove trade barriers and traderule enforcement, and “international promotion of policiesleading to strong, sustainable, and balanced economicgrowth.”

But ag interests continued to push congressional approvalof free trade agreements (FTAs) with Panama, Colombia,and South Korea as crucial pieces of the U.S. trade agenda.

Citing Canada’s aggressive market expansion push, a coali-tion of ag and food groups last week urged lawmakers to workwith the Obama administration to remove remaining impedi-ments to a “rapid implementation” of outstanding FTAs.

The U.S. Department of Commerce recently coordinated18 trade missions with more than 160 companies in 24 coun-tries, while federal loans to support American exporters morethan doubled over the same period last year.

Economist: Atrazine ban would cost many ag jobsBY KAY SHIPMANFarmWeek

The nation’s agricultural sector would losejobs and income related to corn production ifthe U.S. Environmental Protection Agency(EPA) bans atrazine, a University of Chicagoeconomist reported last week.

“A ban on atrazine on the national levelwould have a devastating effect on the U.S.corn economy,” Don Courseytold journalists during a tele-conference hosted by the Tri-azine Network. Courseyrecently completed an econom-ic study on atrazine usage.

EPA is studying the poten-tial health risks related toatrazine. At the end of thereview, the agency will deter-mine if it needs to revise itsposition on atrazine or if cur-rent use restrictions are sufficient.

Coursey first examined the impact of anatrazine ban on Illinois corn production. Heestimated Illinois farmers would lose between$166 million and $450 million annually due toreduced yields, increased production costs,and other factors.

Then, Coursey applied a similar economicloss to U.S. corn production. He estimatedU.S. corn growers would lose between $2.3billion and $5.08 billion annually if atrazineuse is banned.

By applying that economic loss to thenational Gross Domestic Product, Coursey esti-mated the nation would lose between 21,000and 48,000 jobs related to corn production.

That loss of jobs would cause the ag sectorunemployment rate to increase from 12 per-cent to 14.6 percent, according to Coursey.

The impact would be even greater if thejob losses were concentrated in the nation’scorn-growing sector, he added.

“Ninety to 95 percent of the (ban) impactwill be felt by small, rural family farms,”Coursey said.

An atrazine ban would result in additionalloss of jobs related to grain sorghum and sug-ar cane production, he added.

“We know how important a single job oreven a handful of jobs are in a rural com-munity,” said Jere White, chairman of theTriazine Network and executive director ofthe Kansas Corn and Grain Sorghum Grow-ers.

A recent University of Illinois studyshowed atrazine also is a key managementtool for sweet corn production. U.S. sweetcorn growers would pay an additional $9.2million for weed control if atrazine is banned,according to Marty Williams, U of I andUSDA ecologist.

Nearly half of H1N1 vaccines may go unusedThe H1N1 flu outbreak

last year, which initially wasmislabeled “swine flu,” iscosting the U.S. more thanlost pork exports.

About $260 million (40million doses) of H1N1 vac-cine produced for the U.S.expired at the end of June.

The outdated vaccine willbe incinerated, the Associat-ed Press reported.

But the losses may notstop there. About 30 millionadditional doses of the vac-cine will expire later this yearand could go unused.

If the remaining vaccineexpires, more than 43 per-cent of the supply for theU.S. public will have gone towaste, AP reported.

Overall, the governmentlast year purchased nearly 200million doses of H1N1 vacci-nations, which is about doublethe amount of vaccine madefor seasonal flu.

But demand for the vac-cines never materialized astests showed one vaccine wasenough to protect most peo-ple; much of the vaccine wasnot ready until late 2009 whenthe largest wave of illnesseshad passed; and H1N1 turnedout to be much less deadlythan feared.

Federal officials defended thelarge purchase as a necessaryrisk taken to protect the publicagainst a new virus. Many healthofficials feared H1N1 couldturn into a global epidemic.

Instead, about 12,000deaths were attributed toH1N1, which reportedly isabout one-third of the esti-mated annual deaths fromseasonal flu.

Where Ideas That Grow Mean Policies That Glow

Join a Glowing GrassRoots Issue TeamWhen you join one of Illinois Farm Bureau s eight GRITs Teams (GrassRoots Issue Teams), you bring to the table big-picture ideas– thoughts you and your neighbors have about the future of agriculture.

IFB s GRITs teams bring together ideas from across the state. Some ideas grow into other ideas. Some get energized and become action plans. Others light the way to new and improved policies.

Gl

owing Grassroots Results

Electrif

iedwithAction

Plans

Apply for One of These Teams• Conservation and Natural Resources • Crop Production and Trade • Equine • Livestock and Dairy • Renewable Resources and Energy • Risk Management and Farm Programs • Rural Life • Specialty Crops and Labor

To Apply Call your county Farm Bureau or IFB at (309) 557-3984, or go to ilfb.org. Applications must be submitted by August 16.

Your Idea

‘Ninety to 95 percent of the (ban) im-pact will be felt by small, rural familyfarms.’

— Don CourseyUniversity of Chicago economist

STATE


SUMMER LAWMAKER VISITS

County Farm Bureau leaders and their adopted state legislators are taking advantage of summer toconnect with each other. Top photo: Wayne County Farm Bureau President Fred Blessing, left, andcounty Farm Bureau board member David White, right, chat with state Rep. Andre Thapedi (D-Chica-go) during a recent tour of his Chicago district. Bottom photo: Winnebago County Farm Bureauleader Bob Phelps, right, discusses modern beef production with state Rep. Elaine Nekritz (D-North-brook) who toured his farm and several others during her recent visit. Winnebago County Farm Bu-reau manager Roger Christin looks on. Cook County Farm Bureau leaders joined both lawmaker vis-its. (Photos by Christina Nourie, Illinois Farm Bureau northeast legislative coordinator)

U of I’s MarketMaker aiding Gulf fishermen

To help Gulf Coast fishermen and shrimpers whose marketsare devastated by the oil spill, the Louisiana State University(LSU) Agricultural Center is turning to an online marketing pro-gram developed by the University of Illinois Extension.

Known as MarketMaker, the program is an online databasethat will connect Gulf Coast seafood producers with commer-cial buyers and consumers across the U.S. MarketMaker is oneof the most extensive collections of searchable food industrydata in the nation.

Since the oil spill crisis, areas of the Gulf have been closed tofishing, and many wholesale seafood buyers located at the portsare not getting the sufficient volume they need to stay open.

Fishermen are bringing in their seafood catches with no placeto sell them. In other cases, boats are not coming to port so theydon’t disrupt clean up of oil in or near the ports.

During July, U of I Extension specialists will hold trainingworkshops in Louisiana to help implement MarketMaker.

“We have asked U of I Extension specialists to pull up theirboots with us, and they have said, ‘We want to help.’ We are stillin a crisis disaster response mode, and MarketMaker has cometo the top as being one of the life rings that we can implementimmediately,“ said Paul Coreil, director of the Louisiana Coop-erative Extension Service.

National MarketMaker currently includes 14 states with threemore developing sites. For information, go online to{http://national.marketmaker.uiuc.edu}.


High-speed Internet will bringopportunities to the five Southern Illi-nois counties served by Shawnee Tele-phone Co., but 100 new jobs may beone of the most welcome additions,according to Michael Guffy ofShawnee Telephone Co.

Last week, Guffy continued to sortstacks of congratulatory phone mes-sages that followed an announcementthat his company will receive $7.4 mil-lion in grants and loans.

“People are very excited and anxious

to hear about it,” Guffy said.Shawnee Telephone was the lone

Illinois recipient selected in the latestround of federally funded broadbandprojects.

Shawnee Telephone’s fiber-to-homenetwork will improve Internet servicesin about nine communities in fivecounties. Officials estimate the project,which includes $1 million in local fund-ing, will create 100 jobs initially.

“We’re hoping for more (jobs) afterthat,” Guffy added.

The area has the state’s lowest per-household income and high unemploy-

ment, a fact Guffy was surprised tolearn when he moved there two yearsago. “We’re really excited that this pro-ject will stimulate the economy,” headded.

Guffy said he anticipates that high-speed Internet will boost tourism whenlocal campgrounds offer visitors broad-band connections.

Shawnee Telephone hopes to part-ner with the U.S. Forestry Service tooffer broadband access in the area’snational forest, he added.

In addition to economic benefits,high-speed Internet services will

expand information available to localschool districts, libraries, and medicalfacilities.

Shawnee Telephone also wants towork with Southeastern Illinois Col-lege, Guffy added.

Since the announcement, Guffy saidhe’s been surprised by the support hiscompany has received from many eco-nomic sectors, including agriculture.

IFB supports expansion of broad-band services in rural Illinois, andupgrading broadband services is part ofthe Illinois Smart Agenda developed bythe Vision for Illinois Agriculture.

Federal broadband funds bringing opportunity, changes

Efforts to improve water quality launching in IllinoisKevin Donoho, NaturalResources Conservation Ser-vice (NRCS) district conserva-tionist.

For example, farmers maydevelop a row-crop nutrientmanagement plan that meetsNRCS standards. The planmay include switching nitro-gen applications from fall tospring. “Our long-term goal is by trying nutrient(management) plans toimprove water quality andsave farmers money, too,”

Stikkers said. “This is a volun-tary approach to address anissue that others want to regu-late.”

Participating farmers wouldsign approved contracts for aminimum of one year up to amaximum of three years.They would receive up tothree annual payments forimplementing such conserva-tion practices as strip till, notill, cover crops, drainagemanagement, and filter strips.

With assistance from AFT,

a retired soil fertility expertwill be hired to work with par-ticipating farmers and answerany questions. Stikkers andDonoho welcomed the addi-tional help because their staffswouldn’t have been able todevote that much time to asingle watershed, they noted.

“USDA is trying to takeprograms and partner withothers. This is trying to makepeople work together andmake it better,” Donoho said.— Kay Shipman

Champaign County farmersin a subwatershed of theUpper Salt Fork watershed willlearn Tuesday about newefforts to improve water quali-ty by reducing nutrient runoff.

The American FarmlandTrust (AFT) is working withthe Champaign County Soiland Water Conservation Dis-

trict (SWCD) on a three-yearproject that received a$750,000 grant from USDA.

Through a competitive

process, USDA awarded $11million for 75 projects in theMississippi River Basin. TheChampaign County watershedis part of the larger VermilionRiver watershed selected byUSDA in January for a specialMississippi River Basin initia-tive.

Meanwhile, the LivingstonCounty SWCD is finalizingdetails on its water quality pro-ject in the Indian Creek water-shed, according to DebbieRuff, SWCD executive andeducation director. More infor-mation will be released soonabout the $1.01 million IllinoisCooperative ConservationPartnership Initiative project,Ruff said.

In the Champaign County27,000-acre watershed, thefocus will be on helping farm-ers better manage appliednutrients through a range ofconservation practices, accord-ing to Bruce Stikkers, SWCDresource conservationist, and

‘This is a volun-tary approach toaddress an issuethat others wantto regulate.’

— Bruce StikkersChampaign County Soil andWater Conservation District

THE ESTATE TAX


Continued from page 1number of qualifications and conditions.

For example, eligible land (land used in active farming forfive of the previous eight years) must remain within the familyand in farm use for 10 years.

If within that period, heirs dispose of that property to any-one other than a family member or take it out of qualified usefrom the decedent, they are subject to additional estate taxes.

Even cutting timber or selling a conservation easement oninherited land risks added tax liability, Wolff said.

“The race is on to see who can get 60 votes,” she stressed.“Our efforts are to work for 60 votes to get the best deal.

“Isn’t a $5 million exemption, with no strings attached, bet-ter? For farms that are bigger than $5 million, if we would getmore 2032A, we would say, ‘Go for it.’ But it’s not a tradeoff.”

Estate tax

Under the anticipated return of the estate tax in 2011, Madison County’s Larry Martin fears “my generationand those that follow will be punished for having parents who worked hard, made smart decisions, and pro-gressed their farming operation.” Without “death tax” reform or repeal, he feels his own two sons and niecelikely will be unable to continue in the family business. (Photo by Ken Kashian)

Planning the imponderables:Estate review recommended

Gone today, potentially back tomorrow undercurrently unspecified terms — estate tax uncertain-ty is a head-scratcher for farm financial planners.

Country Financial senior advanced plannerLorraine Zenge is concerned Congress maydelay action on the “death tax” until after fallelections, complicating an already uncomfort-able situation for producers and their heirs.

“This has left clients, planners,and attorneys in a quandary asfar as what to do going forward,”Zenge told FarmWeek.

The best strategy appears tobe to plan for the imponderables,she said. Zenge urges farm fami-lies to consult an attorney even ifan estate plan is in place, “partic-ularly if illness or advanced ageis bringing those issues to theforefront” and their estate exceeds $1 million —the default 2011 estate tax exemption if Con-gress takes no action.

“There are ways in which some of those pre-viously written plans could have unintendedresults if there were a death in 2010,” the advis-er warned. “One likely would never havethought we would have no estate tax in 2010.”

For example, “formula clause” provisions forseparating estates into marital and family trustscould leave spouses effectively “disinherited” inthe event of a 2010 death.

“Most family trusts are written to ensurespousal income, but problems could arise result-

ing from how the formula clause was draftedthat separates the marital and family, or creditshelter, shares,” Zenge said

Producers also may consider gifting toreduce potential estate tax exposure. The annual$13,000 federal gift exclusion remains in placefor 2010, and producers can make a gift of cashor assets to each offspring up to that level “with-

out an issue,” Zenge said.Gifting appreciating farm assets or other

assets expected to appreciate in value (such asstock), rather than cash, is “always a good strate-gy,” removing “growth” and thus taxable valuefrom the eventual estate, she said.

Gifts can be made throughout the year, andZenge sees no pressing need to wait for resolu-tion of the estate tax issue before making annualexclusion gifts.

“If individuals intend to make a gift thatexceeds that exclusion amount, they should def-initely see their tax adviser,” she said. — Mar-tin Ross

‘There are ways in which some of thosepreviously written plans could have un-intended results.’

— Lorraine ZengeCountry Financial

BY MARTIN ROSSFarmWeek

The cliche “death and tax-es” has become a sort ofmacabre “joking point” forMadison County producerLarry Martin and his family,given an anticipated shift fromno federal estate tax this yearto a potentially alarming taxliability scenario.

But to Martin and his par-ents, uncertainty surroundingthe “death tax” and how itmight impact their nearly 46-year-old farm legacy is any-thing but humorous.

Because of a nearly 10-year-old congressional loophole, theestate tax could be reinstated in2011 with a $1 million individ-ual exemption, barring con-gressional action. That’s vs. the$3.5 million exemption ineffect when the tax temporarily“expired” Dec. 31.

Farm Bureau is pushing forapproval of a $5 million per-person/$10 million per coupleexemption as part of its “PutDeath Taxes to Rest” cam-paign.

Martin said he and hisbrother, Steve, and their par-ents, Bernard and Donna, con-tinue to work together, but“we know the inevitable trans-fer of the farm is nearing.”

In his area, where recentfarmland sales have netted$6,500-$10,000 per acre, a1,000-acre estate and accom-panying structures and equip-ment could “pretty easily” top$10 million in value, Martinwarned.

Martin and his brotherfarm “essentially separatelytogether,” but family membersindividually and a group haveconsulted experts in multi-generational farm planning“and have come up with a plan

Grower urges Congress to put anxiety ‘to rest’

that works well for us.” But,he stressed, “The decisionsand actions taken have notbeen easy, due to the status ofthe estate tax exemption.”

“Your action will have alasting effect on many hard-working, multi-generationalAmerican families,” Martinadvised lawmakers consider-ing estate tax reforms.

The elder Martins beganfarming in 1964 after buying150 acres at an area auction.They managed to make endsmeet through “years of highinterest rates, drought, excessrain, disease, and low grainprices” by borrowing equip-ment from neighbors andworking for other area pro-ducers, their son noted.

The parents gradually accu-mulated enough land to par-tially support three families,and their adult sons eventually“chipped in” with added landand equipment. The brothersaren’t formal partners, butthey share equipment: Stevesupplies planters, drills, andtrucks; Larry provides trac-

tors, combines, and graincarts.

Martin’s parents nevercared to incorporate, and heand his brothers maintain sep-arate business and financialdealings. That keeps the oper-ation “slightly more interest-ing,” as well as potentiallymore complex from an estate

planning standpoint, headmits.

Uncertainty over long-termestate tax policy has con-tributed to the Martins’ plan-ning concerns. Noting hisfather once paid $700-$1,000per acre for land now worthmore than $5,000, Martinstressed the need for both ahigher exemption andstepped-up basis.

Stepped-up basis enablesheirs to take the fair marketvalue of an estate for capitalgains purposes and pay capitalgains taxes on the differencebetween the net sales priceand that stepped-up basis ifand when the assets are sold.

“My dad was very shyabout going for estate plan-ning, trying to figure out whatwas going to happen with thewhole estate tax,” Martinrelated. “They (his parents)didn’t want to spend a lot ofmoney to plan something outand then essentially not haveit recognized after whatever(legislative) plans were laid.

“Next year, things (poten-tially) revert back, and wedon’t know exactly what’sgoing to be recognized. Thekind of estate planning we dotoday might not be correctnext year.”

Thus the dilemma facingmany Illinois farm families.

GOVERNMENT


Partial E15 approvals this fall?

Senators, Colts player join ethanol game planBY MARTIN ROSSFarmWeek

Senate Democrats havejoined in the call to acceleratetest data needed to break the 10percent ethanol blend wall, “sothat both consumers and ourbiofuels industry are not furtherharmed” by federal delays.

But even expeditedapproval for “E15” (a 15 per-cent blend) may be highlyconditional, the administra-tion warns.

In a letter to the president,Midwestern senators includingSpringfield’s Dick Durbinstressed a “great sense ofurgency to utilize more home-grown fuels” in the wake ofthe Gulf oil spill.

The lawmakers voiced“serious concerns” aboutdelays in U.S. Department ofEnergy (DOE) test resultscrucial to U.S. Environmental

2006 vehicles should be com-plete and EPA can make a“further determination” forthose cars.

At the same time, “it hasbecome clear that insufficientdata have been submitted onthe use of E15 in older vehi-cles and non-road engines toenable EPA to make a decisionon a waiver that would allowthe use of E15 for theseengines,” the White Houseasserted.

Tom Buis, CEO with theethanol industry coalitionGrowth Energy, reiterated hisgroup’s stance that “E15 couldgo into all cars — that there isno difference between E10and E15 for the performanceand durability of engines andemissions system.”

“We believe we submittedsufficient data for the EPA tomake a decision on all vehicle

types, and while they may dis-agree, our waiver (request)stands as is,” Buis toldFarmWeek.

Growth Energy helped kickoff a campaign last week tospur biofuels action when law-makers return from their July4 break this week.

Ohio Gov. Ted Stricklandand Indianapolis Colts tightend Dallas Clark joined in aMidwest tour seeking mandat-ed “flex-fuel” capabilities inU.S.-sold automobiles and fed-eral support for installation of“blender pumps” that allowmotorists to dial up variousethanol blends.

U.S. Reps. Stephanie Her-seth Sandlin (D-S.D.) andAdrian Smith (R-Neb.) aresponsoring a measure thatwould fund half the cost ofinstalling blender pumps andstorage tanks.

ProtectionAgency (EPA)approval of afuel waiver forblendsbetween E10and E15.

In Decem-ber, EPAextended itsreview of

“intermediate” blends, indicat-ing a decision would be forth-coming by summer. However,the agency still requires furtherDOE data.

Given long-term federalbiofuels mandates, the sena-tors said “it is vitally importantthat our domestic biofuel pro-duction continues to grow —unhindered by the 10 percentby volume limit for ethanol ingasoline blends.”

“It has become very clearthat a higher blend is feasible,

and any delay in implementingit is now at the doors of theDOE,” they maintained.

The White House last weekargued DOE’s testing programwas “consistent with nationalprotocols and in conformancewith engineering best prac-tices,” encompassing hundredsof vehicles including 82undergoing full “useful life”testing to gauge long-termemissions and performance.

Useful life testing is beingconducted 24 hours a day, theWhite House reported, buteven under this “acceleratedprotocol,” each vehicle requires6 to 9 months of testing.

By the end of September,DOE testing on 2007 andnewer models will be completeand EPA will act on the E15request for those vehicles, theadministration stated. InNovember, testing of 2001-

Sen. Dick Durbin

Climate specialist:Renewable energyincentives are crucial

Sound, incentive-driven U.S. energy policy is a crucial piecein a global approach to controlling climate change, according toMichael MacCracken, chief scientist for climate change pro-grams with the Washington-based Climate Institute.

MacCracken sees varying approaches to greenhouse gas(GHG) reduction across the planet. Solar energy appears anideal technology for desert regions. Biofuels and hydropowercan meet needs in wet tropical regions.

The realities of modern China suggest to MacCracken a mixedapproach, blending renewable and nuclear power with “efficientcoal” and restoration of carbon-trapping vegetative land cover.

The U.S. needs “all the approaches we can take,” from diversi-fied electrical generation and “fossil fuel-neutral” building designto wind energy and biofuels, MacCracken told FarmWeek. Andthat sets up opportunities as well as challenges.

For example, many Native Americans originally were forcedto relocate on marginal lands buffeted by high winds and noware attempting to capitalize on that former liability. However,MacCracken warned that potential cannot be fully realized untilwind energy suppliers nationwide can connect to the electricaltransmission grid.

While electricity “can do a lot for us,” he argued liquid bio-fuels will be crucial to reducing GHGs in a mobile society. TheU.S. Department of Defense is proving bio-based aviation fuelsare possible, MacCracken related.

However, ethanol, biodiesel, and wind energy producers arecontinuing to fight for extension of and/or consistency in fed-eral tax credits and programs designed to encourage alternativeenergy development.

“What’s needed right now are some incentives,” MacCrackensaid. “What we’re hearing too much of in Congress is, ‘This isgoing to be expensive; it’s going to be difficult.’ But once youcan get some incentives in place, there are so many approachesthat can come about.”

Just as global approaches vary, MacCracken insists U.S. ener-gy-climate legislation must be “systematic,” considering diverseregional resources and needs. At the same time, he acknowl-edged continued debate not only between various regions butalso among diverse energy interests.

“Everybody’s sort of circling the wagons and shootinginward,” MacCracken said. “That’s why it’s difficult in Congress— there are different situations. It’s not going to be a simplething; it’s going to be a complex bill.” — Martin Ross

Regulatory costs a concernfor small meat processorsBY DANIEL GRANTFarmWeek

The livelihood of manysmall and independent meatprocessors could be at riskdue to increased regulatorycosts.

The Food Safety andInspection Service (FSIS)recently proposed implement-ing new and costly require-ments for local meat proces-sors under the Hazard Analy-sis and Critical Control Point(HACCP) Systems Validationproposal.

“It’s a definite concern,”said Terry Jones of Jones Meatand Locker — a third-genera-tion, 67-year-old business inJacksonville. “If the originalproposal had been implement-ed, it would be very hard tostay in business for any small(meat) processor.”

FSIS originally proposedmicrobial testing for allinspected processing plants.But possible new rules couldbe redefined — FSIS by lastweek had held one of threepublic hearings on the issueand plans to issue a seconddraft of proposed regulatorychanges.

Microbial testing “is a bigcost factor” that could putsome small processors out ofbusiness, said Dianne Hand-saker, executive secretary forthe Illinois Association ofMeat Processors (IAMP).“Most live off very small mar-gins” and have no means topass along costs.

The American Farm BureauFederation wrote a letter toFSIS that noted many AFBFmembers who raise livestockrely on small and independentmeat processors to processmeat for their own consump-

tion and to satisfy niche mar-kets.

Deer hunters also havevoiced concern over findingprocessors for deer harvestedevery year.

“(Local meat processing)facilities are most at risk fromincreased costs due to (newvalidation costs for) multiplespecies and multiple products,with a relatively low volume tospread those costs,” the AFBFletter stated.

Handsaker, for example,believes a small processor whoslaughters 100 goats per yearsimply would drop that serviceif new validation costs are putin place.

Jones, a member of IAMP,told FarmWeek about 40 per-cent of his business is slaugh-tering livestock for local farm-ers. And it’s one of the fewgrowth areas for many smallprocessors, he said.

“More and more peopleare trying to market their ownanimals as a way to supple-ment income,” Jones said.“We’re finding an increase inthat (private labeling) busi-ness.”

Illinois has lost a numberof small meat processors inthe past but still has 229inspected plants that would beaffected by new regulationsalong with about 20 customplants that would not beaffected by a change in FSISrules. The number of process-ing plants in recent years hasremained stable, according toHandsaker.

“This (process for FSIS toestablish new regulations)could take up to a year orlonger,” said Handsaker, whonoted the Food Safety Work-ing Group implemented bythe Obama administration ispushing the stricter food pro-cessing regulations. “Therestill are a lot of unansweredquestions.”

Information about the situ-ation is available on the webat{www.illinoismeatprocessors.com}.

‘More and more people are trying tomarket their own animals as a way tosupplement income.’

— Terry JonesJones Meat and Locker

Bernie Walsh, Durand, Winnebago County: No rain toreport this week and now it hasbeen three weeks since our lastrain, except for the one tenth wegot Wednesday night. The cornand beans still look good; theyare not showing any signs ofstress, probably because wehad such good soil moisture.

Some wheat fields have been combined, butvery few. Ours was almost 20 percent mois-ture on Thursday, so that will take awhile todry down. Early reports are of just averageyields and pretty good test weight. Some ofthe yellow beans are turning green with thedrier weather.

Leroy Getz, Savanna, Carroll County: There was a threatof heavy rain nearly every daythis past week, but we receivedonly 0.65 of an inch for theweek. Crops continue to lookgood. Some sprayers have beenworking. Green beans are beingharvested and trucked to theprocessors. I’ve seen one wheat

field combined — others are ready.Producers are reminded to certify their plant-ed crop acres at the Farm Service Agencyoffice before the Thursday deadline.

Ron Frieders, Waterman, DeKalb County: Once in awhileI like to look at my notes andcompare today with past years.In 2006, crop conditions werevery similar. Corn was tasseling,beans were more than knee highand blooming, and wheat wasbeing harvested. Another similar-ity is that people were urged to

contact their legislators and push for the pas-sage of the Permanent Estate Tax ReleaseAct of 2006. On Jan. 1, the “death tax”returns with a 55 percent rate. Let’s not letthe oil spill, recession, or the war distract usor our elected officials. This is the mostunfair, double taxation, small-business-destroying tax on the property people workso hard all their lives for. Let our elected offi-cials know you are aware and Novemberelections will soon be here.

Joe Zumwalt, Warsaw, Hancock County: There is littlefarm activity to report in WesternIllinois. On and off showers andthunderstorms left from 1 to 4inches of rainfall across HancockCounty. While the crops havetaken on a little better color, theyield potential is still drasticallydown for the year. There is a lot

of corn tasseling and the soybeans havereally taken off, ranging from emerging tofour and five trifoliate. Crop dusters havebeen busy spraying insects and fungicide oncorn. Let’s hope it never gets too wet forthem to fly. It’s too bad that my yard isn’t acash crop this year.

Ken Reinhardt, Seaton, Mercer County: It looked like wewere getting shorted on rain butwe finally got 2 to 3 inchesWednesday night. It’s still plentysoft, as I found out when I turnedtoo short down at the elevator.While I was waiting for the policeto close the highway, the tow dri-ver told me he had been out until

3 a.m. July 4 pulling out a row-crop sprayerdown to the frame. Most of the April-plantedcorn has tasseled. There is good potential onwhat is there, but there are way too manybare and stunted areas within most fields. Itis fair week already, July 13-17. It is impor-tant to attend and support your local fair.

Ron Moore, Roseville, Warren County: The dry weather hascome to an end. We received 2.3inches of rain last week. Areas tothe south got up to 4 inches. Thebean field in which I had plantedthe wet spots for the third time nowis under water again. Since April 1,I think it has had water on it moreoften than it has not. Those will be

some of the unharvested acres for this fall. Thecorn that has not been damaged is starting topollinate. The shorter and yellow corn will notpollinate for awhile yet. It is going to be very dif-ficult to time any fungicide spraying this year.The early-planted beans have nearly closed in30-inch rows. They should start floweringsoon. Weed control has been good so far. Iexpect to start hearing about diseases with thewet conditions. Pasture conditions are still verygood with all the rain we have had.

Jacob Streitmatter, Princeville, Peoria County: Afteran unusual nice, dry week here,I received some rain onTuesday — anywhere from 0.6to 1.5 inches. Wednesdaybrought another half-inch ofrain, and on Thursday wereceived a couple tenths more.Hard to believe, but the first rain

did help. The grass was starting to get dryand the crops were starting to show signsof stress. Hopefully, we can receive niceshowers from here on out. A lot of corn istasseling and soybeans are blooming.Crop conditions look better from the seatof my car than from the truck, planter trac-tor, mower tractor, or roof of the grain bin.However, I did feel better as I flew out ofthe Peoria airport and realized I am notalone.

Tim Green, Wyoming, Stark County: We have had twoalmost dry weeks, and wereally needed that. Our corncrop is starting to look like itmight make something. Ourcorn around here looks prettytough. I would say our crop rat-ings are 6 percent good andprobably 30 percent poor. Just

too much water. People are starting tospray Headline, or they are trying todecide how or whether to spray becausethe cornfields are so uneven. Tassels areout on some corn and some is only a foothigh.

Mark Kerber, Chatsworth, Livingston County: Lastweek was hot and dry with afew scattered showers towardthe end of the week. Corn wasnot looking good as the heatwas beginning to cause stresson these shallow-rootedplants. Fungicide spraying isstarting as I see planes

buzzing around. Gray leaf diseases couldbe worse this year with all of the wetweather we have had. Most of the corn isnow pollinating. Soybeans are looking bet-ter with the drier weather, although we willneed timely rains to keep them growingand flowering. Wheat harvest is over —there wasn’t much planted due to the wetfall. Haven’t heard any yields. LivingstonCounty Fair-goers will be working on theirprojects as our county fair is July 19-22.Producers are hoping we can sustain arally this summer going into harvest. Lastyear our highest prices were in the fall.

Ron Haase, Gilman, Iroquois County: We receivedanywhere from a few drops ofrain up to 0.15 of an inch ofrain. We need much more withall the heat and shallow-rootedcrops. Corn is anywhere fromthe V11 to up to a few fieldsabout to enter the R2 or blisterstage. Many fields have been

pollinating over the last week. A few fieldshave had a fungicide applied over the lastcouple days. Some soybean fields wereplanted for the first time this past week.Other fields were replanted in spots. Areasoybean fields are anywhere from emer-gence up to the R2 growth stage.Herbicides also were being applied in soy-bean fields. Area soybean farmers arewondering how much below trend theyields will be vs. whether we will maketrend line yields. The local closing pricesfor July 8 were $3.57 for nearby corn,$3.58 for new-crop corn, $9.84 for nearbysoybeans, and $9.07 for new-crop soy-beans.

Wilfred Dittmer, Quincy, Adams County: Hello from arain-drenched Adams Countywhere we might as well mea-sure rainfall in buckets insteadof inches after receiving 4inches in the first three days oflast week. That brings our totalsince March to at least 17inches. We are more than wet.

A little spraying did get done last week,but some fields still need attention. Cornfor the most part has improved some, butis still a long way from the bin. Some istasseling awfully short, so it may be inter-esting when the combines start up.Soybeans are growing and most standsare good with little insect activity. I haveseen a few Japanese beetles. Some haydid get put away last week.

Brian Schaumburg, Chenoa, McLean County: Crops con-tinue to develop nicely with1,490 growing degree units todate, plenty of subsoil moisture,and sunshine. Scouting for foliardisease reveals common rustbeing most prevalent. Sprayplanes are making steadyprogress. Soybeans are return-

ing to a deep green color. What a rally! Corn,$3.59 and $3.54, fall; soybeans, $9.91 and$9.01, fall; wheat, $4.78.

Steve Ayers, Champaign, Champaign County: A quietweek with ideal pollination condi-tions after our record June rain-fall. Corn is nearly all tasseledwith an average height about sixfeet. Beans are about one thirdblooming. Showers movedthrough Thursday but rains werespotty. Our area is 15 percent

surplus moisture, 68 percent adequate, 15percent short, and 2 percent very short.Extended forecast looks like temperaturesfrom 70 to 90 with chances of pop up storms.A few planters are dubbing in ponds as mostof the water has disappeared. Sprayers,mowers, and balers are rolling, and a fewfarmers are emptying bins. Some fields weretreated with fungicide. Let’s be careful outthere.

Carrie Winkelmann, Menard County: Rain was scatteredthroughout the area last week.We received only 0.25 of an inch,but there were places in the coun-ty that received much more.Pollination is ongoing. The yellowplanes have been out sprayingfoliar fungicide. Wheat harvest iscomplete, and I have received

reports of low test weights.

Tom Ritter, Blue Mound, Macon County: A chance of rainon Thursday skirted just to thesouth in southern Macon County.Even though moisture at thispoint is not real critical, it wouldbe nice to get the pump primed.Corn pollination has been wrap-ping up with adequate moisture.Soybeans, of course, need more

rain as we go along here, especially duringAugust. Overall, crop conditions look good.Spraying of fungicides is starting to slow a lit-tle. Herbicide application on soybeans also ispretty much caught up at this point. Very littlefield activity going on. Farmers are hoping forperiodic rains along the way. The slightlycooler temperatures will help crop growingconditions considerably.

Todd Easton, Charleston, Coles County: It was a goodweek for crops in the ColesCounty area. Fieldwork is almostwrapped up and crops havebeen developing at a steadypace. Most of the corn crop com-pleted pollination with the help ofnear-perfect temperatures andis on a path to develop some

pretty good ears. Soybeans are still in theblooming process and growing steadily.Fields all over are looking much better nowthat the sprayers have had their chance totake care of the weeds. Farming methods ofyesteryear will be revisited next weekend asthe local antique tractor club fills the fair-grounds with equipment and displays ofyears past. It is a great way to remember howthings were and appreciate the advancesmodern farming has made. If you are in thearea, we hope to see you there.

Jimmy Ayers, Rochester, Sangamon County: We didn’thave any rain at our place lastweek. It actually is turning a littlebit dry in the area. Not too faraway from us 1.5 inches wasmeasured in the gauge. There’s alot of roadside mowing and guysfinishing up hay. Several peopleare taking a little vacation. Many

people enjoyed the fair at Christian County thispast week. If you can cut down 30 stalks atyour county corners and save a life, you mightwant to think about doing that. We trimmeddown a little last week to make it safer for thecommunity. Most of the corn has tasseled, and15-inch beans have closed the rows. The drillbeans closed a long time ago. You can still seedirt between the 30-inch rows. The marketsare responding to the shortage of last year.You might want to reward the market for thesebig up moves — 5 or 10 percent, maybe.


CROPWATCHERS

Dean Shields, Murphysboro, Jackson County: Last weekwas hot and humid for us untilThursday night when showerscame through and we got any-where from 0.5 of an inch toprobably 1 inch or so. Someplaces had a real downpour andothers didn’t get very much atall. The corn crop is coming

along and I’m seeing a lot of black silks nowon the corn. Beans are continuing to grow.Like I keep reporting, we have all differentsizes of beans. I planted some more beansWednesday on some of the low ground Ihave. The river is still giving us a fit in that itis very high and the locks are closed. We willhave to keep the pumps running to keep theseep water out. Most of the low land gotplanted. Wheat field beans are up and look-ing pretty decent. This shower should helpthem quite a bit. Most of the time is beingspent spraying beans and doing right-of-waymowing. Everybody is hunting for that job ina cool cab. Everybody stay cool, and hope-fully it is going to rain.

Ken Taake, Ullin, Pulaski County: It’s been another hot, dryweek here in deep SouthernIllinois. Crops were really start-ing to show the stress from allthe dry weather. Both corn andbeans are looking like they needa big rain. We did have a reallight shower Thursday evening. Iwould estimate it as 0.10 of an

inch or less. Every little bit helps, but we sureneed a nice soaking rain. Otherwise, we aredown to the usual summertime activities,mowing, working on equipment, and trying tostay cool. Again, please remember to becareful in your activities this summer.

Dan Meinhart, Montrose, Jasper County: Thousandsand thousands of acres ofbeans were planted in the lastweek to 10 days, especially inthe I-70 corridor. Hay balingalso was in full swing. Postchemicals were being ap -plied. Farmers were busydoctoring up their stunted yel-

low corn by applying nitrogen. Somefungicides have also been applied to theearly-planted corn. Showers were in thearea Thursday and Thursday night leav-ing various amounts of rain. Our gaugeshowed 2.5 inches. Showers were stilllingering in the area Friday morning. Theheat index has been around 100degrees. More showers are in the fore-cast for early this week.

Bob Biehl, Belleville, St. Clair County: Corn was look-ing stressed around here allweek, then on Thursday wereceived 1.2 inches of much-needed rainfall. Some areas inthe county received signifi-cantly more, maybe up to 5inches. This rain should takeour corn a good ways into the

kernel development stage. Beans seemedto do a little better this past week thancorn, not as many noticeable stress areas.This rain will help loosen the ground in thebean fields, as the ground is mostly shad-ed now. Beans are about to get the darkgreen color where they get the next growthspurt. Japanese beetles are the only pestproblem. Populations are not significantenough to justify treatment, however. Grainmarkets were exciting last week with old-crop corn hitting $3.93; cash beans,$10.31; and cash wheat, $5.50 at the riverterminals.

Kevin Raber, Browns, Wabash County: It was raining asI wrote this report Friday morn-ing. I had 0.3 of an inch of rainin my gauge so far. We reallyneeded a rain. The lighter soilsare really showing stress. TheWabash River went belowflood, but I don’t know howlong it will take to dry out the

replanted acres. That’s the way it goes.Your light soils are burning up, and it’s toowet to replant your bottom ground.

David Schaal, St. Peter, Fayette County: It was a hot,humid week here. Rains finallyentered this part of the countyabout 5 p.m. Thursday. Thenorthern part experienced rainThursday morning with some itbeing heavy — 2 to 3 inches. Weended up with about 1.5 inches,some coming early Friday morn-

ing. This rain was really welcome. A lot ofcorn is pollinating unless it was late-plantedcorn or re-planted. That corn also looks verygood. As far as the soybean crop, things areall over the board from plants almost knee-high to beans just emerging. There was a lotof spraying of soybeans last week. In theRoundup soybeans, it seems to take oldtechnology sprays to kill water hemp andmarestail. Roundup alone is not killing ourbroadleaves anymore. Fungicide also isbeing applied on cornfields, some with high-rise ground rigs but most with planes. Grainprices rallied some last week: corn, $3.67;new-crop corn, $3.64; soybeans, $10; new-crop soybeans, $9.20. Fayette County Fairstarts this week, so more rain probably willoccur — it usually does. We won’t turn itdown. Get out and enjoy your county fair.

Ted Kuebrich, Jerseyville, Jersey County: Jersey Countywas back in the oven last weekwith temperatures in the mid-90sand high humidity. We receivedabout half an inch of rain lastweek with more on the way. Thekernels on the early-planted cornare at blister stage. Most of thecorn is in excellent condition,

although you can find some fields of corn plant-ed in the creek bottoms that have not yet tas-seled. The early beans are putting on bloomsand are in very good condition. There still isbean planting going on in some of the creekbottoms. The Illinois River at Hardin is at 430feet, 5 feet above the flood stage of 425 feet.Prices at Jersey County Grain, Hardin: July2010 corn, $3.77; fall 2010 corn, $3.66,January 2011 corn, $3.82; July 2010 soybeans$10.12; fall 2010 soybeans, $9.34, January2011 soybeans, $9.55; July wheat, $5.15.

Rick Corners, Centralia, Jefferson County: 1.2 inches ofrain and still raining Fridaymorning. Yeah, that’s what I’mtalking about. The corn was indire need of this, and the beansreally appreciate it, also. Notmuch else to say other thanbring it on.

Page 7 Monday, July 12, 2010 FarmWeek

CROPWATCHERS

Reports received Friday morning.Expanded crop information available at FarmWeekNow.com

BY BARRY NASH Although most postemergence

herbic ide appl icat ions have beenc o m p l e t e d w i t h i n t h e l a s t f e w

weeks in both cornand soybeans, sever-al weeds continue tomake their presencek n o w n — w a t e r -hemp, giant ragweed,l ambsquar ters, andm o r n i n g g l o r y , i nparticular.

In some instances,c o m p l e t e c o n t r o l

was not achieved due to inadequateherbicide rates, larger-than-expect-ed weeds, or a brief shower shortlyafter application. In other cases,add i t i ona l weed f l u shes a l r e adyhave begun (waterhemp, in particu-lar).

Although several postemergenceherbicide options are available for

“ la te-season” weed control , i t i scritical to understand the precau-tions and restrictions of each her-bicide prior to application. Consid-er the fol lowing pr ior to makingthat late-season application:

Crop growth stage: Most her-bicides have a crop growth stage orh e i g h t l i m i t a t i o n t h a t r e s t r i c t sapplications during the reproduc-t ive developmental s tages of thecrop.

For example, most soybean her-bicides restr ict appl icat ions oncethe p lant beg ins f lower ing (R1) .H o w e ve r , t h e g l y p h o s a t e l a b e la l l ows app l i c a t ions to RoundupReady Soybeans through the flow-ering stages (R1-R2).

Similarly, some corn herbicidesre s t r i c t app l i c a t ions beyond V6while others allow applications upto tassel (VT). Additionally, a fewherbicides are labeled for applica-

tions after the hard dough stage. Preharvest interval: Preharvest

in t e r va l s a r e e s t ab l i shed by theEnvironmental Protection Agencyto allow sufficient time for a herbi-cide to be metabolized within theplant to non-toxic forms. If a her-bicide application is made withinthat preharvest interval, herbicideresidues may be in excess of estab-l ished l imits, thereby making thegrain unacceptable for human con-sumption.

Crop Rotation Interval: Manyherbicides labeled for late-seasonapplications have slight to moderateresidual activity and require croprotation restrictions for the follow-ing year.

T h e s e h e r b i c i d e s w i l l h ave acomment in the “Precaut ions orRestrictions” section of the labelthat recommend a time period forsafe planting of a different crop the

following growing season. T h e s e r e c o m m e n d a t i o n s t a ke

into account the physical and bio-logical factors required for success-ful degradation of the herbicide —the amount of t ime required formicrobial degradation, amount ofrainfall required, and soil pH.

Recogniz ing the crop rota t ionintervals of a herbicide can becomecritical when applications are madeafter the middle of July — especial-ly if winter wheat is the intendedcrop for the next year.

For more infor mation on late-season herbicide applications, con-tact your local FS crop specialist,who will have the most up-to-dateinformation available on herbicidelabel requirements.

Barr y Nash is GROWMARK’s weedsc i ence t e chni ca l manager. His e -mai laddress is [email protected].

Considerations for late-season herbicide applications

Barry Nash

PRODUCTION


USDA raises crop price projections, wheat productionBY DANIEL GRANTFarmWeek

Price prospects for Illinois’top three crops improved Fri-day as USDA increased itsfeed demand estimate andlowered its ending stocks esti-mate for corn next year by 200million bushels.

USDA reduced its cornending stocks estimates to1.478 billion bushels this yearand 1.373 billionbushels for2010/11. Theprojected endingstocks for soy-beans, 175 mil-lion bushels thisyear and 360 millionbushels next year, were in linewith trade expectations.

Corn use was raised 125million bushels due toincreased feed and residual use.Meanwhile, winter wheat pro-duction was estimated at 1.51billion bushels, which is up 2percent from last month butstill is 1 percent below last year.

USDA subsequentlyincreased its season-averageprice estimates by a dime perbushel for soybeans, 15 cents

for corn, and 20 cents forwheat. The projected priceranges currently are $8.10 to$9.60 per bushel for beans,$3.45 to $4.05 per bushel forcorn, and $4.20 to $5 perbushel for wheat.

However, the near-termprice trend could be lessfriendly.

USDA on Friday estimatedU.S. farmers this year will har-

vest a record 78million acresof soybeans.Crop yieldsalso wereprojected toaverage abountiful

163.5 bushels per acre forcorn and 42.9 bushels per acrefor beans.

“We had a substantial moveup (recently in the crop mar-kets),” said Al Kluis, marketanalyst with Kluis Commodi-ties, during a teleconferencehosted by the MinneapolisGrain Exchange.

“But the old saying is ‘Youhave to feed a bull every day.’We could be susceptible to asell-off and give back some of

(last) week’s gain.”Kluis believes yield and

acreage estimates could belowered in future reports asheavy rain cut planting shortand drowned out a large por-tion of crops in the Midwestwhile parts of the Southeastexperienced the oppositeproblem with extreme dryness.

The analyst projectedacreage could be lowered by500,000 to 1 million acres forcorn and beans. He believesnational yield averages couldbe closer to 161 to 162 bushelsper acre for corn and 41 to 42bushels per acre for beans,which would support prices.

“We have good yield poten-tial in the northern and west-ern Corn Belt,” he said. “Butin the central and eastern CornBelt, we’re seeing crop deterio-ration and there’s dryness inthe Delta and Southeast.”

Elsewhere, crop productionproblems in Europe, Russia,and Canada could support U.S.wheat prices. Wheat produc-tion in Canada last week wasestimated at 20.5 million met-ric tons (752 million bushels),but Kluis believes it could be

closer to 18 million metrictons (660 million bushels) dueto weather-related issues.

In Illinois, USDA loweredthe average wheat yield from

59 bushels per acre on June 1to 54 bushels per acres as ofJuly 1. The current wheat yieldestimate for the state is 2bushels below last year’s aver-

FarmWeekNow.comListen to commentary from AlKluis on Friday’s USDA re-ports by going to FarmWeek-Now.com.

Crop conditions quitevariable around Illinois

Illinois every year has its share of “garden spots” and “cropdisasters” due mostly to weather variability.

But the difference between the good and bad spots this seasonseems to be as extreme as many farmers have seen in recent years.

“There is a lot of yellow, stunted corn and a lot of unevenfields,” said Phil Fuhr, president of the Rock Island CountyFarm Bureau, who farms near Taylor Ridge. “But on some ofthe better-drained farms, there will be some good yields.

“There is just a lot of variability,” said Fuhr, whose farm isin the western portion of the state that last month receivedanywhere from 10 to 13-plus inches of rain.

Overall, the average height of the corn crop (67 inches) inthe state as of the first of last week was well above the five-year average (54 inches).

However, the height of the crop ranged from 58 inches inSouthwestern Illinois to 73 inches in Northeastern Illinois.

“Corn is anywhere from setting ears to three inches tall inmy area,” said Ray Krausz, president of the Clinton CountyFarm Bureau and a farmer from Mascoutah.

Krausz was unable to start planting soybeans until June 10and didn’t finish custom-planting beans until July 1.

In fact, many farmers opted not to plant soybeans in low,saturated areas and instead filed prevented planting claims.

“There were a lot of late-planted beans,” Fuhr said. “We’regoing to give up a lot of yield potential.”

Many stunted cornfields also surrendered yield potential aswet conditions didn’t allow many farmers to make follow-upnitrogen applications. Fuhr said he is aware of a handful offarmers who had urea dropped on fields via airplanes.

“It was so wet in June, nothing could be done,” he said.Now, farmers can only hope for consistent doses of rain to

keep many shallow-rooted crop fields going without giving upyield potential, Krausz said.

“Rainfall is going to be the main issue (the rest of the sea-son),” he said.

Overall, the conditions of the corn crop in Illinois last weekwere rated 68 percent good to excellent, 20 percent fair, and 12percent poor to very poor.

Soybeans were rated 59 percent good to excellent, 28 per-cent fair, and 13 percent poor or very poor. — Daniel Grant

WIU bull test entries due Aug. 31Western Illinois University’s (WIU) School of Agriculture is now

accepting entries for its annual bull test program. Entries for the112-day test are open to any breed and are due by Aug. 31, accord-ing to Ken Nimrick and Bruce Engnell, program co-directors.

Nimrick, who is also an associate ag professor, noted the bullsmust be weaned and started on a preconditioning program no lat-er than Aug. 20.

“The WIU bull test offers breeders the opportunity to comparetheir bulls against bulls from other breeders when the animals arefed and managed in the same environment,” said Engnell.

“It also provides the individual bull owners the opportunity toget data on the bull’s feed efficiency,” Engnell said. “Feed efficien-cy has always been important and is even more so with theprospect of ongoing high feed prices.”

Nimrick noted few on-farm testing situations can gather this typeof data, and it is extremely important for the breeders’ economics.

In addition to average daily gain and feed efficiency, the WIUBull Test Program provides information on scrotal circumference,pelvic area, ribeye area, fat depth and marbling. In addition to thetest program, bulls will have ultrasonic data gathered.

A sale of the top bulls will be held March 18.For more information, contact Nimrick at 309-298-1288 or

Engnell daytime at 309-298-2613 or evenings at 309-298-1276, orthe ag school at 309-298-1080.

Interested individuals also may write: Ken Nimrick, WIUSchool of Agriculture, 1 University Circle, Macomb, Ill., 61455-1390.

Entry forms for this year’s test, along with information on lastyear’s program, are available online at {www.wiu.edu/bulltest}.

BIOTECHNOLOGY


Refuge concerns seen as frustrating, unscientificBY MARTIN ROSSFarmWeek

Proposals to prohibit biotechcrops within Midwest wildliferefuges is frustrating to produc-ers deprived of other key agro-nomic tools and confounding toone of the nation’s foremostexperts on crop genetics.

Lewis Hollis farms 875 acreswithin the Crab Orchard Nation-al Wildlife Refuge, which covers43,890 acres in Williamson, Jack-son, and Union counties.

Hollis has farmed theresince 1971, but years ago, theU.S. Fish and Wildlife Service(USFWS) banned atrazine andmetolachlor (Dual) herbicideuse, leaving him few optionsother than planting glyphosate-resistant GMO corn and beans.He has used biotech crops onrefuge land since the late 1990s.

Now, USFWS is crafting an

Hollis sees glyphosates andthus GMO crops as crucial toSouthern Illinois growers, espe-

cially given concernsabout johnsongrass.He argued CrabOrchard producersand officials haveconducted ongoingenvironmentalassessments foryears.

“We have beengrowing GMOcrops on CrabOrchard Refugesince they were first

patented and put onthe market,” the John-

son County FarmBureau president said.“If there’s been anadverse effect, it hasn’t

shown up.“The eight farmers who farm

on Crab Orchard Refuge have agood working relationship with(refuge personnel). We have ayearly meeting to discuss anypositive or negative effects per-taining to agriculture in CrabOrchard.”

Among other things, CrabOrchard farmers must reportannual glyphosate use rates —

according to Williams, “fineanecdotal evidence” to confirmcontinued herbicide efficacy.

The Delaware case wasbrought on behalf of groupsincluding the Audubon Societyand the activist Center for FoodSafety. Tuskegee UniversityCenter for Plant BiotechnologyResearch Director C.S. Prakashsees advocates of new restric-tions “trying to whip up senti-ments against GM crops.”

“With both corn and soy-beans, there’s really no problem,because there are no wildspecies that are cross-compati-ble in the areas we’re talkingabout,” Prakash toldFarmWeek.

“The corn has no known(wild) relatives in the U.S. Thesame with soybeans — soybeanscame to us from China, andthere are no relatives that can(pose) a soy gene issue in theU.S. Both are really non-issues.”

Most compatible corn rela-tives are found in Mexico, whereGMO plantings to date have notproven “a problem at all” saidPrakash, a recent USDA AgBiotechnology Advisory Com-mittee member who also advisesthe Indian government.

environmentalassessment(EA) of agpractices for54 nationalrefuges acrosseight states,focusing oncontinuedGMO use.The agency

reports “concerns have beenexpressed about the long-termeffect of GM crops on the envi-ronment, wildlife habitat, andhuman health.”

“Public scoping” of assess-ment issues ended Friday, and adraft EA is to be issued by Sept.1 for public comment. A finalassessment is expected by Dec. 1.

In 2009, a federal courtrequired USFWS to assessenvironmental risks of plant -ing GMO crops in Delaware’s

Prime Hook National WildlifeRefuge, and USFWS notedseveral eastern refuges noware facing law-suits.

USFWS’ issueswith GMOs arebroadly stated:“Some peo-ple” fearinsect-resis-tant traitscould impactbutterflyspecies, and “ithas been sug-gested” GMOcorn or soybeanscould “hybridize”with and thus buildherbicide resistancein related wildspecies.

Agency-stated issues extendbeyond refuge protection:USFWS cites concerns that“GM crops in the human foodchain” may pose risks for aller-gies and other “unintended con-sequences,” despite federal find-ings to the contrary.

American Farm Bureau Fed-eration biotech specialist RussellWilliams suggests a refuge ban is“probably against public policy.”

Lewis Hollis

Sustainability and yield:Devil in the definitions?

A new National Academies’ National Research Councilreport argues ag research is focused too heavily on increasedfood production and too little on air and water quality.

To farmers and scientists eyeing precision farming, biotech-nology, and other reduced-input strategies for boosting per-acre yields, those goals aren’t mutually exclusive, and much ofthe work already is being done.

The study raises questions about “sustainability” — a con-cept that has spurred wide-ranging debate over organic vs.“conventional” farming, GMO vs. non-GMO crops, and“local” vs. larger-scale commercial production.

To American Farm Bureau Federation biotech regulatoryspecialist Russell Williams, the devil lies in the definition.Williams sees two basic “camps” — “those who want to feed agrowing population and those who don’t.”

“In my mind, sustainability is a balance between social, eco-nomic, and environmental factors,” Williams told FarmWeek.“The ability to produce more food on an acre of land with aper-acre reduction in inputs is a good thing. You can feed morepeople; you have less of an impact on the environment.

“Some people look at sustainability only in an environmentalcontext: ‘How much can we produce given these environmentalconstraints?’ However many people an organic-only system canfeed is how many it will feed.

While biotechnology is seen as a key to reducing inputswhile boosting per-acre yields, environmental and some organicgroups have stepped up anti-GMO efforts.

The U.S. Supreme Court recently ruled against a lower courtinjunction against Roundup Ready alfalfa plantings, but plaintiffsare gearing up for a second attack on Roundup Ready sugar beets.

Sen. Patrick Leahy (D-Vt.) has asked USDA to maintain cur-rent restrictions on Roundup Ready alfalfa production. As of lastweek, nearly two dozen House members had signed onto acounter request asking the department to allow productionpending the outcome of an ongoing environmental impact study.

Williams is optimistic about the sugar beet case, given theSupreme Court’s decision: “I would think a very similar casewould have a very similar outcome.”

But Gregory Conko, senior fellow with the CompetitiveEnterprise Institute, is concerned about long-term biotechpolicies particularly at the Cabinet level.

Conko notes Ag Secretary Tom Vilsack is a former Iowagovernor with “a generally positive reputation among the sup-porters of agricultural biotechnology.” Conversely, he said,USDA Deputy Secretary Kathleen Merrigan is a supporter oforganic production and “a big opponent of biotechnology.”

“You’re seeing this sort of love-hate relationship within theUSDA for new agricultural technologies, including biotechnolo-gy,” he said. “I, for one, don’t believe things like biotechnologyare incompatible with sustainable agriculture.” — Martin Ross

POLICY


WTO concerns likely to shape next farm billBY MARTIN ROSSFarmWeek

Lawmakers likely willattempt to balance farmincome with potential globaloutcomes as they formulatethe next farm bill, accordingto Washington trade analystPaul Drazek.

Drazek told FarmWeekCongress will weigh tradeissues in its ag policy debate,“if for no other reason than ithas to take into account thecotton decision” — the WorldTrade Organization’s (WTO)ruling against U.S. cotton sup-ports. Amid fears that Brazilcould retaliate against U.S.goods, he expects lawmakers

cept would cover the spectrumof current program crops,compared with adjusted grossrevenue crop insurance, whichprovides coverage for a farm’scombined crops and activities.

Under conventional revenueassurance (RA) policies, grow-ers can buy protection field-by-field, for “enterprise” unitsincluding all of an individualcovered commodity within acounty, or by whole-farm unitscombining revenue from allcorn and soybeans within acounty.

Illinois Farm Bureau riskspecialist Doug Yoder notespremiums drop dramatically asproducers move from field-by-

field coverage to enterpriseunits or enterprise to whole-farm coverage. But so dopotential claim payouts, Yodersaid.

Whole-farm unit coveragehas been available to Illinoispolicyholders for several years,“but we don’t use it,” Yodernoted. He is uncertain whetherthat reflects past RA costs rel-ative to other revenue policiesthat don’t offer a whole-farmoption or general warinesstoward a whole-farm concept.

“Say wheat was going to geta huge ACRE payment thisyear, while beans weren’t goingto get squat,” Yoder said. “Thefact that beans had a good(production) year doesn’treduce or eliminate wheat orcorn payments. They’re sepa-rate.

“Under Peterson’s concept,you’d combine all three, andwho knows what we’d get.You’d have to look at yourwheat loss times those acres,your corn loss times thoseacres, and your bean loss timesthose acres, and balance allthat out.”

to eye less “trade-distorting”supports.

But cotton doesn’t standalone. Drazek believes a suc-cessful WTO Doha Roundagreement is still possible, andsuggested the U.S. could agreeto further changes in domesticsupports “if it’s a goodenough deal.”

For example, the 2008 farmbill’s average crop revenueelection (ACRE) program ispart of the WTO’s “amberbox” of purportedly price-dis-torting and thus annuallycapped subsidies.

If Congress moved fromstate ACRE yield triggers tomore precise county triggers

and total farm paymentsincreased significantly as aresult, spending could exceedannual WTO limits and tradedisputes could ensue.

One answer could be tomove ACRE into the “greenbox” — the WTO’s repositoryfor uncapped supports such asdirect payments.

Key to reclassifying sup-ports as “green” is decouplingthem from specific commodi-ties: Drazek said a move to a“whole-farm” revenue pro-gram, an idea raised by HouseAg Committee ChairmanCollin Peterson (D-Minn.),might meet that goal.

Peterson’s whole-farm con-

July 15Southern IllinoisUniversity-Carbondalefield day, 8 a.m., BellevilleResearch Center,Belleville. For information,call 618-566-4761.

Northern IllinoisAgronomy ResearchCenter field day, 4 p.m.,Shabbona. For informa-tion, call Dale Baird at815-978-2844.

July 17Pull for AgricultureEducation sporting claysand trap shooting, WorldShooting and RecreationalComplex, Sparta.For infor-mation and registrationdetails, go online to{www.rcfb.org} or call 618-443-4511 or 618-357-9355.

July 22Prairie Rivers ResourceConservation andDevelopment (RC&D)annual meeting dinner atMona’s Restaurant,Toluca, and tour of OakState Products, Wenona.Call RC&D at 309-365-3979 for reservations.

Aug. 13-22Illinois State Fair, StateFairgrounds, Springfield.

Aug. 17Ag Day, Illinois StateFairgrounds, Springfield.

DATEBOOK

EVENTS


IFB Commodities Conference July 28

Export push will boost rural economy — speakerBY DANIEL GRANTFarmWeek

A farmer from Shelbyvilleor a tractor dealer from Fair-field, Iowa, probably doesn’thave much interest in con-sumer/population trends inplaces such as Hong Kong orSeoul.

But what happens in Asiaand other parts of the worldactually could play a key rolein the rebuilding of ruralAmerica, according to Chris-tine Turner, senior adviser forthe USDA Foreign Ag Service.

“We have a very ambitioussecretary (Tom Vilsack) who

Bloomington-Normal and is aUniversity of Illinois graduate.

In fact, she has familymembers who still farm inMcLean County and helpedhost the 1994 Farm ProgressShow on the Pitts, Kinsella,Mecherle Farms east ofBloomington.

“I remember my grandfatherbeing involved in the FarmProgress Show,” Turner said.

After college, Turnerworked as an attorney in NewYork City and more recentlyserved as counsel for the Oba-ma presidential campaignbefore she was appointed to

her current position.“It’s incredibly gratifying to

work on these (ag trade)issues,” Turner said. “It’s anice combination of my per-sonal and professional back-ground.”

Registration for the confer-ence is available through countyFarm Bureau offices or online at{www.ilfb.org}. The pre-regis-tration deadline is Friday. Anycancellations received after July19 will not be refunded.

For hotel reservations, con-tact the Marriott Hotel andConference Center in Normalat 888-236-2427.

is very focused on reinvigorat-ing rural economies aroundthe country,” Turner toldFarmWeek. “A strong part ofthat (push) is to increaseexports.”

President Obama earlierthis year unveiled the NationalExport Initiative with a goal todouble U.S. exports, includingagricultural goods, in the nextfive years.

Turner this month (July 28)will discuss agriculture’s role inthe plan and export marketpotential and trends at the Illi-nois Farm Bureau Commodi-ties Conference at the Marriott

Hotel and Conference Centerin Normal. Registration at theevent will open at 7:30 a.m.and the program will begin at8:30 a.m.

“We’re lucky ag trade hasprovided a surplus for the last50 years,” Turner said. “That’s atribute to the efficiency andeffectiveness of U.S. producers.”

USDA last month projectedU.S. agriculture in 2010 willgenerate a surplus of $28 bil-lion compared to $23.2 billionin 2009.

The speaking engagementalso will be a homecoming forTurner, who grew up in

Ag 2010 Illinois State Fair focusNew interactive attractionto teach kids about agThe Illinois State Fair Aug. 13-22 will pay tribute to the

state’s agricultural industry with a new interactive exhibit forfamilies and the theme, Cream of the Crop.

“This year’s fair will showcase Illinois’ agricultural rootswhile also recognizing Illinois farmers for being the cream ofthe crop, the best of the best,” said Illinois State Fair Manag-er Amy Bliefnick.

The new attraction, named Farmer’s Little Helpers, willteach children about agriculture through hands-on activitiesrelated to the ag industry. A mock farm will include miniature

barns, a corn crib, seed gardens, a farmers’ market, and a gro-cery store. Young visitors will be offered activities at each sta-tion.

“I’m very excited about Farmer’s Little Helpers and wouldlike to thank all the sponsors for their support. Without them,none of this would be possible,” Bliefnick added.

The Illinois Corn Marketing Board (ICMB), Illinois Soy-bean Association (ISA), County Market (Niemann Foods) andGrain Systems Inc. are major exhibit sponsors.

“This exhibit allows a glimpse into the work of familyfarmers in Illinois,” said Donna Jeschke, a Mazon farmer andpast-chairman of the ICMB.

“More than that, we hope that by visiting this exhibitchildren and adults will feel a direct connection to thefarm, the farmers and their families, and the food wegrow here.”

“The Illinois Soybean Association is proud to be involvedwith the new Farmer’s Little Helpers exhibit at the IllinoisState Fair, said ISA Secretary Doug Winter, a farmer fromMill Shoals.

“We feel this is a great opportunity to show visitors theconnection between soybeans grown by Illinois farmers, live-stock raised throughout our state, and the food people eat,”

Other sponsors include Illinois Farm Bureau, the Ameri-can Egg Board, Brandt Consolidated, Corn Products Interna-tional, Illinois Beef Association, Illinois Pork ProducersAssociation, Illinois Standardbred Owners and BreedersAssociation, Midwest Dairy Association, and USDA FarmService Agency.

The United Brotherhood of Carpenters Local 16 and Local742 are donating expertise to help construct new buildings forthe exhibit.

USDA recently announced funding throughRural Development to support small start-upbusinesses in rural areas. July 16 is the applica-tion deadline for the current fiscal year.

Funding is available through Rural Develop-ment’s new rural microentrepreneur assistanceprogram (RMAP), which was authorized bythe 2008 farm bill. Non-profit organizations,institutions of higher learning, and federallyrecognized Indian Tribes are eligible for loansand grants to support microentrepreneurs.

“Support for small rural businesses is oneof the most important investments RuralDevelopment can make,” said Colleen Calla-han, Rural Development state director.

Eligible organizations may apply to RuralDevelopment for loans between $50,000 and$500,000 at 2 percent interest for up to 20years. Those organizations, in turn, will re-lendthe money in rural areas to sole proprietorsand small businesses with the equivalent of no

more than 10 full-time employees.The “micro-borrowers” may apply to the

organizations for loans up to $50,000 at a fixedinterest rate for up to 10 years. The loans maybe used for working capital; purchases of fur-nishings, supplies, inventory, or equipment;debt refinancing; business acquisitions; andalready improved real estate intended for locat-ing a business.

The organizations eligible for the RMAPfunds also may apply for grants to providetechnical help and training to microntrepre-neurs and prospective micro-borrowers.

Applications will be accepted throughout theyear and awarded on a quarterly basis; however,for fiscal year 2010, applications must bereceived by July 16. A total of $45.1 million isavailable with $36.2 million set aside for loans.

More information in Illinois is available bye-mailing [email protected] or calling217-403-6218.

USDA announces funds for rural microentrepreneurs

FB IN ACTION


Illinois FFA and 4-H representatives present a special Illinois Farm Bureau Youth Education wreath to guardsat the Tomb of the Unknown Soldiers at Arlington National Cemetery, Virginia. A closeup of the wreath isshown in upper right. The teens learned about history and cooperative businesses on a recent trip sponsoredby IFB and affiliated companies. (Photo by Mariah Dale-Anderson, IFB youth activities manager)


A glimpse of Vice Presi-dent Joe Biden and a WhiteHouse tour were two high-lights for 75 Illinois FFA and

4-H members who participat-ed in a recent Heritage andCooperative Tour, sponsoredby Illinois Farm Bureau andaffiliate companies.

The group happened to betouring the U.S. Capitol at thesame time the vice presidentcame to the Hill. The Illinoisteens also were able to secure aWhite House tour, which arelimited due to tightened securi-ty, according to Mariah Dale-Anderson, IFB youth activitiesmanager.

The tour groups includedthe winning FFA chapters whowere honored for their cooper-ative programs and the topFFA chapters that won awards

for their heritage programs.Cooperative winners also

toured several cooperativebusinesses, including a fruitprocessor, dairy, and electricco-op, on their way to Wash-ington, D.C. Meanwhile Her-itage winners toured severalhistorical sights, including Get-tysburg National Park.

After meeting in Washing-ton, D.C., the two groupstoured several governmentbuildings, historical sites, andmuseums. In a moving cere-mony, they presented a specialwreath at the Tomb of theUnknown Soldiers in Arling-ton National Cemetery (seephoto).

Cyclists to raise money for IAITCCyclists will travel through a six-county area in Eastern Illi-

nois Sept. 7-9 during the 15th Annual Illinois Agriculture in theClassroom (IAITC) Bike Ride.

The IAA Foundation hosts the annual fundraising event tosupport ag literacy programs. The early registration deadline isAug. 20.

This year’s ride will highlight routes through Ford, Grundy,Iroquois, Kankakee, Livingston, and Will counties. The riderswill stop at about 30 schools and perform a skit stressing theimportance of agriculture and offering some bicycle safety infor-mation.

“This ride not only provides an education for the students,but also the cyclists,” said Paul Roney, bike ride co-chairman. “Ifarm in Central Illinois, and this ride has allowed me to see firsthand different agricultural issues facing my peers around thestate.”

The other co-chairman, Charlie Grotevant, added: “The bikeride is a lot of fun, provides an opportunity to meet a lot ofgreat people, and raises funds for a great cause.”

All the routes follow paved roads and will begin and end inKankakee each day. Riders may participate on one, two, or threedays and have an option to ride short (about 40 miles), medium(about 65 miles), or long (100 miles) routes.

The IAA Foundation is accepting registrations. Riders whoregister by Aug. 20 pay $75. After that date, the fee increases to$95.

Individuals who raise money for IAITC will receive specialrider benefits. Riders who raise between $250 and $499 willreceive free registration; those who raise $500 to $999 willreceive free registration and meals, while those who raise $1,000or more will receive free registration, meals, and lodging.

More information about registration and fundraising is avail-able online at {www.iaafoundation.org} or by calling 309-557-2230.

Ag youth learn about historyand cooperative businesses

DAIRY LESSONS

More than 200 visitors from seven Manteno kindergarten classesalong with their teachers and numerous parents paid a recent visit to

the Surprenant Dairy Farm in rural Man-teno. Here, Dave Surprenant speaks to thestudents about how the cows are cared forand what they eat. All the cows at the Sur-

prenant dairy are pasture fed. The farm milks about 160 dairycows and has a total of more than 300 cows. Kankakee CountyFarm Bureau provided ice cream treats for all of the visitors follow-ing the tour. (Photo courtesy of Kankakee County Farm Bureau)

FROM THE COUNTIES


BUREAU — An infor-mational seminar about

marketing techniques will be at6:30 p.m. Wednesday, July 21,at the Farm Bureau office.The seminar is an extension oflast summer’s Marketing 101series. Dinner will be served.Scott Stoller, Michlig Ag, andDan Aubrey, ConsolidatedGrain and Barge, will be thespeakers. Call the FarmBureau office at 815-875-6468by Friday for reservations ormore information.

• Two informational meet-ings on the U.S. Environmen-tal Protection Agency’s spillprevention, control, and coun-termeasure rule will be Mon-day, July 26. The first meetingwill be at 9 a.m. at the BureauCounty Farm Bureau officeand the second at 1 p.m. at theMarshall-Putnam CountyFarm Bureau office. ClemWeborg, Ag View FS’ energymarketing manager; and KevinRunkle, Illinois Fertilizer andChemical Association, will bethe speakers. Call the FarmBureau office at 815-875-6468by Monday, July 19, for reser-vations or more information.

CHAMPAIGN — TheCommunications Com-

mittee will meet at 7 p.m.Monday, July 19, at the FarmBureau office. Agenda itemsinclude the Farm Bureau web-site updates and developing anew mission statement. Feed-back is welcome. Send yourinput on these two topics [email protected].

• Farm Bureau will sponsora renewable energy seminarfrom 7:30 to 11:30 a.m. Thurs-day, July 22, at the FarmBureau auditorium. Breakfastwill be served. Topics includeFarm Bureau organizationalpolicy, wind energy, updateson renewable energy, climatechange and its impact on ag,and the industry’s outlook oncorn and soy-based renewable

fuels. Registration forms areavailable at the Farm Bureauoffice or on the website at{www.ccfarmbureau.com}.Call the Farm Bureau office at217-352-5235 for more infor-mation.

JACKSON — TheWomen’s Committee

needs to borrow antique farmtools and equipment for anexhibit at the John A. LoganMuseum. Items will be on dis-play from January to June.The committee needs a pictureand measurements to submitto the museum before the endof August. Call the FarmBureau office at 618-684-3129for more information.

KANKAKEE — FarmBureau and County

Corn Growers will sponsor a“Cultivating Communication”meeting at 7 p.m. Tuesday atthe University of IllinoisExtension office, Bourbon-nais. Suggestions on helpingthose in agriculture tell theirstory using the social mediawill be discussed. KellyRivard, North Central CollegeInternet communications anddesign student, and Ray ProckJr., Ag Chat Foundation, willbe the speakers. Call the FarmBureau office at 815-932-7471for reservations or more infor-mation.

LASALLE — LifeLineScreening will conduct

tests for stroke, abdominalaortic aneurysm, peripheralarterial disease, atrial fibrilla-tion, and osteoporosis.Receive an additional $10 offof four or more tests. Call theFarm Bureau office at 815-433-0371 for costs or reserva-tions.

LEE — Farm Bureauand the Lee County

Fair Association will sponsoran American Red Cross blooddrive from noon to 6 p.m.Thursday, July 22, at the LeeCounty Fairgrounds. Call the

Farm Bureau office at 815-857-3531 or [email protected] if you canvolunteer or donate.

• The Lee County FarmBureau Foundation will spon-sor a raffle for your choice ofa John Deere or Case IH pedalcombine. Tickets are $5 orthree for $10. The winner willbe selected Sunday, July 25, atthe Lee County 4-H Fair andJunior Show. All proceeds willbenefit the ag literacy pro-grams. Tickets are available atthe Farm Bureau office orfrom a board director. Callthe Farm Bureau office at 815-857-3531 or [email protected] for moreinformation.

• Two informational meet-ings on the U.S. Environmen-tal Protection Agency’s spillprevention, control, and coun-termeasure rule will be Mon-day, July 26. The first meetingwill be at 9 a.m. at the BureauCounty Farm Bureau office,Princeton, and the second at 1p.m. at the Marshall-PutnamCounty Farm Bureau office,Henry. Farmers in Lee,Bureau, Marshall-Putnam, andStark counties are invited. Callthe Farm Bureau office at 815-

857-3531 by Monday, July 19,for reservations or more infor-mation.

MCDONOUGH —Farm Bureau will

sponsor a Marketing 102 semi-nar at 7 p.m. Thursday, July 22,at the Farm Bureau office.Andrew Goodrich, RussellGrain, will be the speaker.Call the Farm Bureau office at309-837-3350 for reservationsor more information.

PEORIA — The Heartof Illinois Fair runs

through Saturday. FarmBureau has a Spin the Wheelgame in the Exhibit Hall.

• Delivery for Michiganblueberries will be from 8:30a.m. to 5 p.m. Thursday at theFarm Bureau office.

• A History of Illinois Agri-culture tour will be Thursday,July 22. Participants will visitthe Gillett Home, Elkhart Hill;Prairie Home near Funk’sGrove, and Haws WoodenGrain Elevator. Cost is $40,which includes bus, lunch, andtours. Call the Farm Bureauoffice for more information.

• Deadline to order Cal-houn County peaches is Fri-day, July 23. Peaches are avail-able in 25-pound boxes.

Delivery to the Farm Bureauoffice is Thursday, Aug. 5.

SANGAMON — TheMarketing Committee

will sponsor a crop risk man-agement workshop at 6 p.m.Wednesday at the FarmBureau office. Steve Johnson,Iowa State University Exten-sion farm and ag businessmanagement specialist, willpresent “Controlling the CropControllables.” Call the FarmBureau office at 753-5200 forreservations or more informa-tion.

• A Farm Bureau policydevelopment “tailgate talk”will be at 5:30 p.m. Tuesday,July 20, at the Farm Bureauoffice. Rich Guebert Jr., Illi-nois Farm Bureau vice presi-dent, will provide a policyissue update. Members willhave an opportunity to expressconcerns on policy. Call theFarm Bureau office at 753-5200 for reservations or moreinformation.

“From the counties” items aresubmitted by county Farm Bureaumanagers. If you have an activityor event open to all members, con-tact your county Farm Bureau man-ager.

Auction Calendar

Thurs., July 15. 10a.m. 80 Ac. Moultrie

Co. Sarah E.Broughton Trust, MT.ZION, IL. Wm. BeckAuction and Realty.

www.williambeckauctions.com

Sat., July 17. 10 a.m.Farm machinery. EarlRinkenberger, BUCK-LEY, IL. Bill Kruse and

Raymond Cleary,Auctioneers. bil-

lkruse.netSat., July 17. 10 a.m.333 Ac. Jefferson Co.

SESSER, IL. MarkKennedy, Auctioneer.

buyafarm.com.Sat., July 17. 10 a.m.Real Estate Auction.

Estate of CharlesAldridge, WOLF LAKE,

IL. Alex Belcher,Auctioneer and Real

Estate Broker.Sat., July 17. 10 a.m.Real Estate Auction.SESSER, IL. Buy A

Farm Land & AuctionCo. buyafarm.com

Mon., July 19. 10 a.m.Farm machinery.

Schultz Bros., HER-SCHER, IL. Mike

Peterson Auctioneers.www.mikepetersonau

ctioneers.comSat., July 24. 9 a.m.

Auction. Northwest Eq.,OREGON, IL. CalKaufman and ToddWills, Auctioneers.

Tues., July 27. 7 p.m.96.5 Ac. Farmland.Carole Bratton and

William Atchley, Familyof Lowell Peddicord,JOHNSONVILLE, IL.

Carson Auction, Realty& Appraisal Co.

www.carsonauctionandrealty.com

Thurs., July 29. 10a.m. 158 Ac. Farmland.

Marjie Musson,ROBERTS, IL. Bill

Kruse, Auctioneer. bil-lkruse.net

Sat., July 31. 10 a.m.Machinery and collec-

tor tractors. Larry

Armstrong Estate,ODELL, IL. Immke and

Bradleys’ AuctionService. biddersand-

buyers.com/immke andbradleyauctionsinc.comSat., July 31. 10 a.m.

Monroe Co. LandAuction. Edward

Rickert Trust, WATER-LOO, IL. buyafarm.com

Sat., July 31. 9:30a.m. Estate Auction.

Estate of JuliusKartheiser,

YORKVILLE, IL. DeBoltAuction Service, Inc.

www.deboltauctionservice.com

Wed., Aug. 4. 10 a.m.Farm machinery.Harold and Mary

Becker, EMINGTON,IL. Immke and

Bradleys’ AuctionService.

www.biddersandbuyers.com/immke

Sat., Aug. 21. 9 a.m.Large Multi Farmer

Auction. OKAWVILLE,IL. Riechmann Bros.

LLC, Auctioneers.

PROFITABILITY


Feeder pig prices reported to USDA*

Weight Range Per Head Weighted Ave. Price10 lbs. $36.10-$47.29 $40.3440 lbs. $55.18-$64.00 $60.3950 lbs. n/a n/aReceipts This Week Last Week

20,897 25,403*Eastern Corn Belt prices picked up at seller’s farm

MARKET FACTS

Confirmed lamb and sheep salesThis week 756 Last week 550 Last year 873Wooled Slaughter Lambs: Choice and prime 2-3: 90-110 lb., $115-$117; 110-130lbs., $130. Good and choice 1-2: 60-90 lbs., $125. Slaughter Ewes: Utility and good 1-3: $43-$45. Cull and utility 1-2: $37-$43.

Lamb prices

Eastern Corn Belt direct hogs (plant delivered)(Prices $ per hundredweight)

This week Prev. week ChangeCarcass $74.85 $76.55 -1.70Live $55.39 $56.65 -1.26

Export inspections

(Million bushels)Week ending Soybeans Wheat Corn07-01-10 2.3 16.8 35.106-24-10 4.6 18.0 39.3Last year 15.8 15.3 35.8Season total 1361.2 70.7 1518.5Previous season total 1147.5 66.2 1419.1USDA projected total 1445 900 2000Crop marketing year began June 1 for wheat and Sept. 1 for corn and soybeans.

(Thursday’s price)This week Prv. week Change

Steers $92.50 $91.01 1.49Heifers $92.37 $90.96 1.41

USDA five-state area slaughter cattle price

This is a composite price of feeder cattle transactions in 27 states.(Prices $ per hundredweight)

This week Prev. week Change113.94 111.22 2.72

CME feeder cattle index — 600-800 Lbs.

New technology: More is on the wayBY SID PARKS

“Summertime and the livin’is easy,” or so the song goes.For those who have beenstruggling with the spring’s

near-recordrainfall, therecent sun-shine allowedthem to finishplanting, cuthay or wheat,or catch upon crop pro-tection appli-cations.

At the same time, I heardothers say, “Sure could use arain!” Isn’t that always how itgoes? Some are wanting while

others have too much?I feel the same is true with

regard to technology. Whilesome folks feel overwhelmedand choose to wait or not par-ticipate at all, I have reallybeen impressed by the adop-tion of some of the availableprecision technologies.

In particular, autosteer wasa big help in getting throughsome of the challenges of thisspring. Adverse conditionsand weather-related issuesforced long hours and fatigue,which made this spring a chal-lenge for planting and productapplications.

One manager I visited withlast month said the services

provided and acres coveredwould not have been possiblewithout the precisionresources he had available.

Similarly, a farmer friend ofmine said he used his newlyacquired guidance system tohelp plant soybeans into corn-stalks at 2 a.m., when therewould have been no way toknow where he was otherwise.(I love it when things workout, don’t you!)

Later this month, I will beattending the 10th Interna-tional Conference on Preci-sion Farming in Denver, Colo.This typically brings hundredsof academic, industry, andagriculture practitioners from

around the world to visit andshare ideas, research, and thelatest technology from theirrespective companies or uni-versities.

While not everyone wouldenjoy this, some of us will belike kids on Christmas morn-ing, excited to see all thatmight be available for us toexplore.

I anticipate some of thenewer technologies to be dis-cussed are things such as cel-lular modem communicationtechnologies and RTK (Real-Time Kinematic) networks,remote service and diagnos-tics tools, enhanced guidancesystems, and improved

remote sensing services.I hope to participate in

many of the breakout ses-sions, learn of the new ideasand technologies, and bringthose concepts home with me.

I will then work with our FScrop specialists and precisioncoordinators to ensure theyare current with their under-standing and implementationof new technologies. Contactthem for the latest potentialFS GREEN PLAN solutionsfor your farm.

Sid Parks is GROWMARK’smanager of precision farming. Hise-mail address [email protected].

Sid Parks

Wheat harvest winds down; basis levels improveBY DANIEL GRANTFarmWeek

Illinois farmers last weekcame closer to completing thisseason’s abbreviated wheatharvest.

The National AgriculturalStatistics Service Illinois fieldoffice last week reported 85 per-cent of the 325,000 wheat acresto be harvested in the state thisyear were in the bin as of July 5.This compares with 60 percentat the same time last year.

The amount of wheat acresplanted in Illinois last fall wasdown 59 percent compared tothe previous year.

Farmers in the state who

are dealing with a much small-er wheat crop this year at leasthave seen a large improvementin the wheat basis.

Cash wheat prices, which

ranged from $4.73 to $4.96per bushel in Southern Illinoisthe first week of July, werenear or above the futures priceof $4.87, according to DarrelGood, University of IllinoisExtension ag economist.

This convergence of pricesis a sharp contrast to recentyears. Cash wheat prices in Illi-nois last year slipped to morethan $1 below the futuresprice and as much as $2 belowthe futures price in 2008.

“It (the wheat basis in Illi-nois) has improved dramatical-ly,” said Jeff Hainline, chair-man of Advance Trading, whoalso is a member of theNational Grain and FeedAssociation’s Risk Manage-ment Committee and theCommodity Futures TradingCommission’s special subcom-mittee on convergence.

The improvement in localbasis levels has been creditedto a policy change by the CMEGroup from a fixed storagerate to a variable storage ratefor wheat. The small soft redwinter wheat crop also may beimpacting the market.

“A lot of folks who pushedthat change say the higher stor-age rate has corrected the prob-lem with convergence,” Goodsaid. “It’s harder for the marketto offer a return for those whotake delivery and not load out.”

The CME Group’s maxi-mum storage rates prior to thechange in some cases werebelow actual commercial stor-age costs. The Illinois FarmBureau Profitability AdvisoryTeam supported the changesto the wheat contract.

“The market (recently) hasbeen increasing carry to holdwheat off the market and nowwe’re getting convergence,”Hainline said. “I’m very satisfiedthe contract change CME Groupimplemented is responsible andhas allowed all players access.”

The change in storage ratesfor wheat contracts was notimplemented in the westernstates, and basis levels inKansas City last week wereanywhere from 50 cents to 80cents below traditional levels,Hainline reported.

FarmWeekNow.comVisit FarmWeekNow.com tolearn more on how Il l inois’wheat bas is has improvedduring the past year.

Study: Curbing speculation could destabilize market

Price spikes for gasoline, grain, and other commoditiescould be magnified if lawmakers curb speculative trading infutures markets, according to a new study.

Congress is considering proposals to restrict a growing surgeof speculation in commodity futures that some blame for a2008 spike that netted record corn, rice, and wheat prices. Thecommodity price bubble also pushed gas prices above $4 pergallon.

But new research suggests the billions of dollars invested byspeculators may have helped stabilize prices rather than drivethem up, said Scott Irwin, a University of Illinois economistwho co-wrote the study.

“Restricting investments by speculators could do exactlywhat these proposals are trying to avoid,” Irwin said.

Irwin and Dwight Sanders, economist at Southern IllinoisUniversity, researched the 2007 and 2008 price hikes in thecommodity markets in a study commissioned by the Paris-based Organization for Economic Cooperation and Develop-ment.

The researchers found no convincing evidence that specula-tors aggravated price increases that already were on the rise asdrought cut into grain supplies and growing worldwide demandboosted oil demand.

Instead, the study indicated the influx of cash from indextraders provided a deep new pool of liquidity that reducedvolatility and held price increases in check.

The wheat basis has improved dramatically in Illinois compared to pre-vious years and as of last week cash wheat prices in Southern Illinoisnearly converged with futures prices. Cash prices last week rangedfrom just 10 cents up to 50 cents per bushel below futures prices com-pared to $1-plus last year. In some cases, cash prices last week wereeven above futures prices.

Wheat basis levels in Illinois

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CASH STRATEGISTCorn Strategy

�2009 crop: Use currentstrength to make catch-upsales.

�2010 crop: The Decem-ber contract penetrated keyresistance at $3.85, openingthe door for the move above$4-$4.02 resistance. This maynot happen until later in July.Leave an order to price anoth-er 10 percent if Decemberfutures reach $4.12.

�Fundamentals: Giventhe June 30 corn stocks andplanting numbers, the newUSDA supply/demand num-bers were not as positive ashoped for with 2010/2011U.S. ending stocks forecast at1.373 billion bushels. Still,given the wet June and itsimpact on condition ratings,more analysts are seeing yieldscoming in below USDA’s163.5-bushel projection. Withpollination upon us, the mar-ket has become sensitive tothe short-term weather risksand yield repercussions.Every 1 bushel yield declinecuts 81 million bushels off thecrop size. Soybean Strategy

�2009 crop: Merchantshave mostly shifted basis bidsto November futures, and theyhave reached important resis-tance. Use this opportunity tosell old-crop inventories youmay still have.

�2010 crop: Leave anorder to price another 10 per-cent if November futures hit$9.58, bringing the total to 50percent. We may add another10 percent over the next fewweeks, but want to see howthe crop develops.

�Fundamentals: The newUSDA supply/demand projec-tions were close to expecta-tions. This year’s largeracreage leaves some room foryields, or harvested acres tofall and yet still build suppliesin the coming year. Even so,traders are a little fearful ofweather and yield implicationswith continued signs that thePacific Ocean is slipping into aLa Nina event. That couldbring late-season dryness tothe Midwest.

✘Fail-safe: Complete thenew-crop sale if Novemberfalls to $9.38.

Wheat Strategy�2010 crop: The trend in

wheat shifted higher. Keyresistance levels have beenpenetrated. However, pricescould temporarily set backwith the negative USDA num-bers. New-crop sales shouldhave been increased another10 percent when Chicago Sep-tember reached $5.25, bring-ing the total to 50 percent. Ifit reaches $5.42 again, makean additional 10 percent sale.Given this week’s surge, short-term storage has become lessattractive, especially commer-cial storage. If you price

wheat at harvest — or shortlyafter — get it done.

�2011 crop: With next Julyfutures having moved to $6,make an initial 10 percent new-crop sale now.

�Fundamentals: The first“official” USDA forecast for allwheat production, 2.216 billionbushels, was significantly morethan the trade expected. Worldproduction was forecast todecline from previous estimatesdue to hot and dry conditionsin the Black Sea region, but notas much as expected. Thisshould boost U.S. export busi-ness but not enough to keepstocks from building.

The devil is always in thedetails. That could be saidabout the latest USDA fore-cast for the world wheat situa-tion. On the surface, it cer-tainly looks like buyers willhave an abundant supply ofwheat to choose from thiscoming year.

But, the breakdown showsquite a different case, maybenot one that’s bullish, but onethat’s certainly less bearishthan one might believe.

Where the trade was gearingup for a 10 million to15 mil-lion metric ton (mmt) reduc-tion in world ending stocks,the USDA forecast only a near7-mmt decline. The newstocks-to-use ratio, 28 percent,represents both a reductionfrom last month and last year.But, it’s still a very comfort-able number.

As expected, USDA fore-cast larger supplies and endingstocks in the U.S. What wasn’texpected was an increase inthe Chinese crop and endingstocks. Those two, especially

Basis charts

the latter, tended to mask justhow much the fundamentalstructure tightened outside ofthose two countries.

The stocks-to-use ratio inthe world outside of those twocountries was reduced to 17.5percent from last month’s 19.6percent projection and lastyear’s 21.7 percent. The histor-ical low point was establishedtwo years ago at 16 percent.

In the new estimates,USDA did lower Russian out-put 3.5 mmt, Kazakhstan out-put 3 mmt, Canadian output 3mmt, and the European Union(EU) crop 1 mmt. Privateanalysts indicate the Russiancrop could be another 2 mmtto 4 mmt lower yet.

Wet weather has been aproblem in the Ukraine, Bul-garia, and Romania, but theextent of losses, if any, is stilldifficult to determine. USDAstuck with its 20 mmt projec-tion for the Ukraine. At a min-imum, the rain could cut quali-ty, reducing its competitivenessin world trade this year.

Recent extreme heat hasbeen a problem in both Franceand Germany. While numbersare not yet clear, the EU wheatcrop could be revised lower yet.

In the end, wheat output out-side of the U.S. and China couldfurther tighten. Quality couldslip a little as well. That couldbolster demand for U.S. wheatin the world over the next year.

Because we have such ahuge potential surplus, it coulddiminish downside risk.

Chinese supplies are becom-ing burdensome, too. TheChinese could export a littlemore into Asian countries, butthere is a better chance of see-ing them use more wheat forfeed this year, helping cap anyneed to import corn.

Cents per bu.

World wheat structure changing

PERSPECTIVES


LETTER TO THE EDITORDidn’t stimulusadd to deficit?Editor:

I’m sure we all rememberthe quip by President BarackObama during the presidentialcampaign of “Putting lipstickon a pig.”

Judging by the statement ofRep. Phil Hare in the May 3

edition of FarmWeek, itseems Representative Harebelieves “lipstick on a pig” tobe a valid strategy. What bet-ter way could one use to pro-mote a $5 billion expenditurethan to claim, “This bill does-n’t add a penny to the deficit.It comes out of the stimulus.”

The issue here is notwhether the program is good

or bad, but the attitude ofCongress, and particularly ourcongressmen and senators,when they dole out these bil-lions and spin it as “not addingto the deficit.”

The obvious question hereis “Did the so-called stimulusadd to the deficit?” If we areto believe published reports inthe media quoting various gov-

ernmental agencies, the stimu-lus has greatly increased thedeficit, so what accountingmethod does RepresentativeHare use to declare that this $5billion is deficit free?

This attitude toward the dis-position of our tax money byelected officials at all levels isunacceptable. Too many ofthese officeholders have the

opinion that we, the people,don’t understand and only theyhave the insight to see the “bigpicture.”

I submit that in fact theseofficials are missing the real“big picture” of voter dissatis-faction as how they are han-dling the affairs of the people. WILLIAM SCHROEDER,Hillsboro

More than 60 million people in the UnitedStates ate to celebrate the nation’s birthday.

Americans are great eaters. From Alaska toFlorida and California to New York, citizenscleaned grills, stocked fridges and pantries, hadbackyard cookouts and family dinners, all thanksto the bounty produced by hard-working farm andranch families.

Few other days on the calendar inspire a greatersense of American unity than July 4.

We are reminded of the freedoms we enjoy andpay tribute to those who founded this country. Wehonor those who fight to keep our nation free and

those who have paid theultimate sacrifice.

The holiday also offers anopportunity to examine how

much we depend on each other for the greatselection of food we enjoy.

America’s tastes are as diverse as its population,yet without help from farmers in every state, din-ing on Maine lobster in Nevada or Washingtonapples in Kansas wouldn’t be as easy.

Here in the land of the free there is no setmenu for Independence Day, but many familiesenjoyed hamburgers and lemonade, peach cobblerand ice cream. No matter what the main course,there was a good chance items from multiplestates were on the table.

If beef was for dinner, there was a one-in-fivechance it came from Texas. If you ate chickeninstead, say thanks to states such as Georgia,Alabama, and South Carolina.

There was a good chance those tender morselsfound their way to your plate from farm familiesin the South. Or, how about pork from the Mid-west, or lamb from the West?

Did you enjoy fries or potato salad? Idahopotatoes are some of the best.

Salad was another menu item. California let-tuce, Florida tomatoes, and Wisconsin cheesewere just a few of ingredients. It wouldn’t be“The Fourth” without watermelon, thanks tofarm families in states such as Arizona and Indi-ana.

No matter what was on the grill, in the oven, orin the mixing bowl, Americans enjoyed an abun-dant food supply. But more importantly, they canbe secure knowing that their food is among thesafest in the world and grown by farmers dedicat-ed to caring for our natural resources.

In addition to the diversity of selection andabundance, Americans enjoy year-round foodoptions. Not long ago, buying fresh, tasty producein the winter was not an option. Today, throughsafe, advanced farming methods, we are able toenjoy many foods no matter the season.

Americans recently commemorated our nation’sbirthday. They also could have been thankful forthe national bounty from all 50 states — from seato shining sea.

A Texas native and recent graduate of Tarleton State Uni-versity, Nathan Smith is a public relations intern at theAmerican Farm Bureau Federation.

NATHAN SMITH

guest columnist

United we eat

Our federal gov-ernment is running ahuge budget deficit. In

fiscal 2009 we spent about $1.4 tril-lion more than we collected in taxes, which was justshort of 10 percent of gross domestic product(GDP).

That’s the biggest deficit since World War II whenit reached 30 percent of GDP.

Deficits add to the national debt. The federal gov-ernment borrows in order to spend more than it takesin. It sells Treasury bonds to investors, who lend to

the federal government in exchangefor a promise to repay plus interest.The value of all those Treasury bondsis the national debt — the amountthe federal government owesinvestors.

Some of the debt is held by gov-ernment agencies. The debt held bythe public is usually taken as the mea-sure of what the government owes.That figure was about $7.3 trillion —53 percent of GDP — at the end offiscal 2009. Big deficits add to the

debt, so the share is expected to be 64 percent by theend of 2010.

How will we pay it back? We won’t.The debt got enormous during World War II, and

we never paid it back. We’re still paying interest on it.The reason this didn’t cause problems is that thedeficit dropped to almost nothing right after the warand stayed low in most years through the mid-1970s.

From 1947-1974, the deficit averaged less thanone-half of 1 percent of GDP. The debt grew by$100 billion during those years, but it fell from 109percent of GDP to 24 percent of GDP.

We compare the debt to GDP because GDPmeasures our ability to handle debt. The high-er GDP is, the more tax revenue we can col-lect, and the greater is our capacity to payinterest on Treasury bonds.

We never paid back the debt from WorldWar II, but because we quit running bigdeficits and our GDP increased, the burdenof those interest payments got less and less.

It’s a problem if our deficits are so bigevery year that the debt as a share of GDP

keeps rising. Interest on the debt thenbecomes an ever-bigger share of the federal

budget, and that requires less spending on gov-ernment services, or ever-higher taxes or even

more borrowing. That can’t go on forever, which iswhy it’s called unsustainable.

Since the debt is about two-thirds of GDP now,the deficit has to be less than about two-thirds ofGDP growth to keep the debt share from rising.That’s a deficit of about 3 percent of GDP or less.

Unfortunately, it’s likely that the deficit will be a lothigher than that throughout the coming decade. Thedebt will increase as a share of GDP.

Big deficits in an expanding economy can createproblems. If the Treasury borrows a lot, there will beless left over to lend to businesses, and that reducesinvestment in buildings, equipment, and technology.

The Treasury may have to offer higher interestrates to get investors to buy all those bonds, raisinginterest rates for everyone. The Federal ReserveBoard may decide to keep interest rates lower andbuy those bonds itself, but that would increase themoney supply and cause inflation.

Big future deficits are a problem. Big deficits now,not so much. They’re the result of the recession. Taxrevenues are way down because of all that unemploy-ment. Spending is up, partly because of added entitle-ment payments and partly because of the govern-ment’s stimulus spending.

But deficits during a recession help. The extraspending and reduced taxes increase the sales ofgoods and services, which give businesses a reason toemploy more people. Without the deficits, unemploy-ment would be even higher.

With unemployment near 10 percent, it wouldn’tdo to try to reduce the deficit now. The federal gov-ernment tried that during 1937-38. With the unem-ployment rate still at 14 percent, the Rooseveltadministration cut spending, and Social Security taxeswere first collected.

The deficit was reduced to near zero — and theeconomy dropped into recession. Unemploymentrose to 19 percent.

We do need a long-range plan to reduce deficits toless than 3 percent of GDP. We need to balance thebudget eventually. But not now.

Larry DeBoer is an agricultural economics professor at PurdueUniversity, West Lafayette, Indiana. His e-mail address [email protected].

LARRYDEBOER

Sometimes budget deficits are good

Documents

Illinois FarmWeek July 12 2010