I'm currently in South Carolina at the National Association of County Agricultural Agents Annual Meeting but I would like to get out a summary of the Drought Program, "Making Decisions in a Difficult Crop Year," held last Friday at the Clinton County Fair before too much time passes by.
Purdue Ag Economist Chris Hurt discussed economics and I don't think he had any big surprises - as yield projections drop, prices will be rising. He showed a chart demonstrating that in many poor crop years producers more than make up the revenue lost by reduced production through higher prices. I'm looking at the December futures which stands at $7.84 compared with it being just a tick above $5.00 in May. That's already an increase of over 50% and Chris believes that $10 corn and $20 beans are both possible this year - his exact words were, "It's not crazy to talk about these prices." For Clinton County, even now it looks like we'll have some sort of crop so we should be able to capture the price change (if you haven't sold it yet). That's better than a lot of fields in southern Indiana and Illinois.
One of the differences from past short crop years is how tight stocks are. In the past there was often an early, rapid increase in price followed by a leveling off or even a decline shortly afterwards.. Chris doesn't think this is very likely given the scarcity of corn in storage.
Brittany Shepherd from the Clinton County Farm Service Agency talked about forms of assistance available from USDA. It's important to note that as I type this, Clinton County is not yet a declared disaster area. If we reach D3 on the US Drought Monitor we will automatically become an Ag Disaster County (I think there's a very good chance we get there tomorrow). We are contiguous to Howard County which makes us eligible for some forms of relief. Clinton County farmers are eligible to apply for emergency loans whaich have an interest rate of 2.25%. You cannot hay or graze CRP acres at this time though this may change soon. However even if CRP is released, certain kinds of ground will not be eligible for haying/grazing and you would need to wait until after August 1.
The key in this is that before you do anything with CRP, contact the Farm Service Agency and make sure it's OK.
Matt Weaver from Crop Insurance Specialists discussed some insurance aspects. There are two key points I want to repeat. First, before doing anything beyond normal farming practices with insured acres, contact your insurance agent. Second, all valid crop insurance claims will be paid. Crop insurance is a federally backed program. This doesn't mean they pay for all losses - those are the responsibbility of the insurance company. However if an insurance company can't make the payments, then the federal government steps in. In 2008 a large insurance company went under and the government made sure payments were made.
Rod Miller from Crop Fertility Specialists talked about conditions he's been seeing and implications for future inputs. Spider mites are becoming a serious issue and it's important for farmers to be scouting their bean fields. In this kind of year, spider mites can devastate a crop. Fungicide applications are less certain. As dry as it is, there really isn't much disease out there. There have been applications made to both corn and soybeans to improve overall crop performance, plant health, photosynthesis, etc. I'll offer my obligatory note that Purdue has not found a consistent enough yield response to recommend this practice.
Setting that aside, right now you have beans that are almost in a holding pattern biologically and corn which has its leaves tightly rolled by noon many days. In each of these cases, the plant will not be absorbing the applications very well, or utilizing it in the plant. In particular, if someone sprays when corn leaves are rolled up, the spray doesn't get onto the surface of the leaf. Rod said you absolutely shouldn't be spraying on corn which is rolling like this so any applications that are made should be done in the morning.
I offered just a couple of notes which I'll repeat here. Purdue Soybean Specialist Shaun Casteel compared a couple of previous drought years and came up with an interesting finding. In 1988 corn yields were down over 40% from trend yields and beans were down about 30% in Indiana. In 1991 corn was down 29% but beans were only down 2%. Shaun looked at the weather for those two years and found it was very similar with one exception. In 1988 early August had temperatures from 100-105 degrees and no rain. In 1991 temperatures were in the lower 90's and there was some water. There is still time for soybeans to respond significantly to some rains. Unlike corn where rain will mainly keep things from getting worse, beans can still improve their yield potential.
While we don't have many livestock producers in Clinton County who feed forage we do have some. In southern Indiana some farmers have started to abandon corn and are mowing it either for silage or hay. There is an issue with nitrate levels, particularly in the lower section of the corn stalks. Before purchasing silage or hay from corn, make sure you have it nitrate tested. Also, keep in mind that when we're talking about silage from a failed corn crop, you have corn with no ears. It will not have the same feed value as corn silage normally would. This is important both from a pricing perspective and in calculating rations. The "book values" for corn silage in rations won't work so again, make sure you have it tested so you know what you're feeding.
I haven't yet seen a field in Clinton County which I think, as of now, won't make some sort of crop, however if we do get to that point and you decide to chop/mow your corn for forage, the same holds true for you as a forage producer; test your corn, both for nitrate levels and for its nutritional value.
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