International buyers reassured on quality and quantity of US grain for sale

Written by Jonathan Eisenthal

According to the USDA, corn exports are off 40 percent from their usual rates and grain buying for ethanol and livestock consumption are both off as well, but the 2012 Export Exchange conference hosted in Minneapolis by the US Grains Council and the Renewable Fuels Association helped reassure international buyers that good quality US grain is available.

The most recent estimates by the USDA for this year’s production, 10.7 billion bushels is down 13 percent from the 2011–a remarkable figure in light of the severe drought that struck much of the US Farm Belt this year.

Corn producers John Mages, David Ward and Lori Feltis all represented Minnesota’s corn organizations at the conference, which belong to the US Grains Council. Mages, who farms in Stearns County, took part in a panel discussion about how the harvest went. A farmer from Illinois told about how hard hit drought areas suffered and saw severely constrained production. Mages was able to report the states in the northern tier of the Corn Belt remained untouched by the worst of the weather conditions–the crop is abundant, the grain is high test weight, high quality. This was true for corn from Minnesota and the Dakotas, as well as from the Deep South–Mississippi and Louisiana saw bumper crops thanks to favorable rains.

“Minnesota had record production–1.4 billion bushels,” Mages told the audience. He also noted that “86 million acres harvested nationally was also a record. It’s a surprise that the yield was as good as it was, despite the drought. The hybrids are better than they used to be. This weather would have been completely devastating 20 years ago, but today we can withstand it better. The conference gave the grain buyers a chance to get a feel for what the crop was like in the US–producers like me and Lori and David, and some from the Dakotas and Illinois–it was good to hear directly from the farmer rather than relying on other sources, to know what the crop is like.”

Feltis noted that one particular concern among grain buyers, are the reports of widespread Aflotoxin–a fungus that thrives in drought-stressed corn.

“We were able to reassure them that it’s virtually non-existent in the crop coming from the northern states,” said Feltis.

The fact that central parts of the Corn Belt–huge producers like Illinois–have seen higher incidence of Aflotoxin, has created something of a two-tiered market, according to wire service reports. Buyers are paying premium prices for grain unaffected by the condition.

Because of the drought, many foreign buyers had the notion that this is a replay of 2009, when test weights were off for most of the US crop, but they learned that the opposite is true–despite the lower total production, test weight and quality are above average.

“These overseas buyers were able to make connections and contacts,” said Feltis. “It was a great chance for people to meet each other. It created an open forum, so they could tell us their concerns. For the Asian countries, the biggest concern was price. As a general rule, it seemed like they are very frugal buyers, very price conscious. So we were trying to explain that quality is important. That the results they will get feeding our grain to their animals will make it worth the price.”

 

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Autumn Appreciations

By MCGA Agvocate Michaela Bengtson

Being a college student, I sometimes get caught up in the hustle and bustle of the cities.  So for me, one of the greatest things is getting to go home on the weekends, back to the farm and enjoy the country lifestyle again.  As I was driving home this weekend, I was rolling past the golden fields and started to think about how corn is used every day by my family.

My first thought was about the fuel in my gas tank, which is ethanol.  Ethanol helps the world not only save on oil costs but it helps us use more renewable resources.  Another benefit of ethanol for my family is that it produces distillers grain.  One of the components of our dairy cow’s diets on the farm are distillers grain.  If it weren’t for ethanol, we wouldn’t have that feed source for my favorite cows!  Another benefit is that ethanol can help boost local economies and provide jobs.  In Atwater, an ethanol plant was built in 2005. It not only helped out farmers by providing a new market to keep prices competitive,  but it also gave farmers more confidence that there would always be a buyer for their grain. 

The second thing that I thought about was how corn helps out my mom.  In May, right after the corn planting was done, my mom had a stroke.  Currently, she is working on rehabilitation and gaining back the mobility in her right arm and leg.  One of the things that she sometimes feels is that her arm is tight.  At therapy they have a special machine to help with that tightening.  The main part of the machine is made of crushed corn cobs.  How the machine works is that a patient’s arm is put into a sleeve in the machine and a cuff is secured around their arm to ensure that the sleeve is snug. The machine is then turned on and starts to blow hot air into the crushed corn cobs, which heats them up to very hot temperatures.  The neat thing is that even though the temperature of the air is extremely high, because of the crushed corn cobs, the patient won’t get burned and it helps to loosen and relax their muscles.  It is amazing how something that might only be used for compost is used to help out so many people! 

As I roll past those golden fields, I am so thankful for everything that corn does.  From being a fuel source, to a feed source, to helping a farmer to have an income, to helping people recovering from illness, corn can do a-maize-ing things!

Tim Waibel joins MCGA board of directors

Written by Jonathan Eisenthal

Animal agriculture is still corn’s number one customer in Minnesota, and Courtland farmer Tim Waibel brings direct experience of that to his new position on the board of Minnesota Corn Growers Association. He joined the board in August, to fill out the term of grower leader Curt Watson.

Waibel, 53, raises corn and beans with his wife Mary, and sons Justin and Jonathan, and together they custom finish 25,000 head of hogs each year. Daughters Rebecca and Anna are college students studying nursing and Clarissa, a senior at New Ulm High School, plans to attend South Dakota State University to pursue a degree in ag business.

“Since Minnesota became a state, animal agriculture has been the key mainstay of farmers,” said Waibel. “It has always been a big usage of grain and it will continue to be. As the original, value added use for crops, livestock production is part of what keeps agriculture and our state economy strong.”

Waibel has farmed full time for the past 18 years and his agriculture leadership experience includes four years on the Minnesota Pork Board.

“A lot of issues interest me, and I’d have to say that number one is transportation–we’ve been dealing with the lock and dam issue for a number of years,” said Waibel. “I’d like to help advocate so we can make progress and get the locks lengthened, so the barge operators don’t have to break up their tow-barges. We need modern, efficient transportation if we want to compete in the marketplace.”

Waibel also feels that farm-based renewable fuels are at a critical stage and need as much advocacy as farm organizations can offer.

“We have to continue to get the word out that ethanol is a great solution for fuel and food–it offers a feed product that has become a real staple in animal agriculture, and another point that I think escapes many people is how much ethanol has helped clean up the air emissions. We used to have checkpoints for testing your vehicle’s emissions. After ethanol came on, those disappeared, because ethanol really cleared the air.”

In addition to his work with farm organizations, Waibel continues to be active as a member of the Nicollet County Planning and Zoning Commission. As the main mechanism for managing the county’s land use, Planning and Zoning benefits from the farmer’s perspective, Waibel feels.

“It’s important to do what we can to be fair and to facilitate land uses that keep crop and animal production strong in our county, while we assure that the environment is protected from harm,” said Waibel.

MCGA board of directors includes 18 leaders drawn from across the state. Waibel will serve 18 months to fulfill the remainder of the current term.

 

Minnesota: the bioeconomy’s “Get it Done, Make it Happen State”

What is in the water up in Minnesota? Partnership seems to have become part of a new hybrid DNA, the Digest discovers in its special report on the state’s progress in biobased fuels, chemicals and materials.

There seems to be some confusion at the state level as to exactly what Minnesota’s nickname is – official publications refer to “the North Star State” while the US Mint put “Land of 10,000 Lakes” on the back of the Minnesota commemorative quarter. Since alternatives seem to be generally acceptable, we propose the “Get it Done State” for your consideration.

You see, other states can match Minnesota for its wealth of agricultural and forest resources (though ample they are), or its foundational base in agriculture and energy (via giants like Cargill, CHS and EcoLab) and for its highly-trained workforce (though more skilled they rarely come). But for per-acre yields of moxie and gumption, it would be hard to find a match.

Get it Done, Make it Happen

Leadership seems to be available as a low-cost residue up there, we’ve not yet exactly figured out how or why. Want to push through the transformative Farm Bill through the 2008 House Agriculture Committee? Minnesota’s Collin Peterson took the reins. Help push through the Algae Biomass Organization from great idea to great organization? Minnesota’s Mary Rosenthal, Tom Byrne, and Todd Taylor have been amongst the drivers. Innovative leaders in first-gen fuels like Brain Kletscher at Highwater Ethanol and Steve Christensen at Granite Falls Energy. Academic leaders such as Brendan Jordan, Director of Bioenergy at the Great Plains Institute, and legendary UMinn chemical engineer Lanny Schmidt; innovative venture capitalists like First Green’s Doug Cameron and Tom Erickson; perceptive analysts like Piper Jaffray’s Mike Cox and Mike Ritzenthaler; Luca Zullo, whose VerdeNero consultancy was on the of the first to focus on opportunities in green-black technologies. Just to name a small handful.

See the rest of the article at:

http://www.biofuelsdigest.com/bdigest/2012/08/27/minnesota-the-bioeconomys-get-it-done-make-it-happen-state/

Our Take:
Minnesota’s step-ahead position in the development of renewable energy started with our corn farmers, who believed that we could source our transportation energy in the Midwest instead of the Mideast.

This article is a great tally of all the impressive vanguard efforts rolling out here in Minnesota.

The one miss is to take as accurate recent newspaper reporting on the state of the Minnesota’s corn ethanol industry. Yes, the industry has hit a speed bump with the narrowed margin, but there is unsuspected strength in the farmer-owned LLC ethanol companies (which are not under obligation to publicly report their financials). These companies benefit from not only good timing but also a conservative ethic that favored reducing debt load over increasing profit sharing. Volatility in all energy markets will continue, but these companies will be able to weather the storms.

And the imminent birth of advanced biofuels and biorefinery products will take place among these farmer-based companies as much as any other participants in renewable energy production today.

Yes, Minnesota is a center for innovation. But don’t count the farmers out—they are right in the center of that pioneering spirit.

Forgotten river plays key commercial role

Written by Jonathan Eisenthal

Billions of bushels of Minnesota farm products have started their journeys to world markets with a 14.7-mile ride down the Minnesota River. At that point the Minnesota joins the Mighty Mississippi, and barges continue 1500 miles, where their cargoes are loaded onto freighters and sent into the Gulf of Mexico and from there to all points.

The Upper Mississippi Watershed Association, a group representing both commercial and recreational interests on the Mississippi and its major tributaries in Minnesota and Iowa, organized a paddleboat tour on August 22 to help focus attention on the importance of the Minnesota River.

Since 1982, what is now CHS, Inc., has operated one of the four elevators located at the Port of Savage on the Minnesota River. Since that time 29,000 barges have departed from the CHS slip, carrying 1.6 billion bushels of corn, beans and increasingly distillers dried grains and solubles, according to Clint Gergen, a representative of CHS who took part in the river tour.

Gergen noted that farm product traffic on the river has slowed, but he hopes that strategic changes might reverse that trend, in particular an effort to develop capacity to deliver non-GMO products to markets like Japan. A key to this, and to access to all world markets, is the imminent conversion of the Panama canal to make it serviceable for the current class of ocean-going freighters. (Currently, such freighters must offload their cargo onto smaller ‘Panamax’ vessels, in order to use the canal, and then reload onto larger vessels on the other end of the canal).

The touring party included journalists, government officials, academics and citizen volunteers who are concerned about river issues. The tour was funded by MNDOT, Minnesota Soybean Growers Association and the Upper Mississippi Watershed Association.

Minnesota Department of Transportation sent several representatives, to speak to the importance of the river as part of the intermodal approach—meaning roads, rail, air and water transportation must all work in concert in order to achieve the highest efficiency. One of the effects of intermodality is that the various forms of transportation compete for customers, keeping the cost lower for all users.

“We keep the railroads honest,” said Greg Genz, with Kaposia Marine Service, and a representative of Upper Mississippi Watershed Association. Genz and Gergen describe the capacity at Savage, which CHS and Cargill continue to maintain. The two companies can load 40 barges daily, though current use has fallen significantly below that mark.

“If the river shippers weren’t there, the farmers would be getting hit with a lot higher basis for transport. That’s because the capacity is still there, hasn’t gone away.

A group of soil and water scientists led by University of Minnesota Prof Satish Gupta, and Warren Formo, director of Minnesota Agricultural Water Resources Center, both spoke to the question of sediment loading in the river. Gupta’s current research focuses on the role of groundwater seepage in the undermining of riverbank soil structure along the Minnesota. This seepage leads to slumping of riverbanks and huge volumes of clayey soil enter the river in this way and become suspended sediment. The tour took a run upriver to a bluff in Eden Prairie where the location of several high value homes has become increasingly precarious, due to this seepage-slumping effect.

The effect of the 2012 drought was very evident as the tour made its way both up and down the river. Along the entire length, it was clear that the river is well below its high water mark. Because of the reduced flow, the normally cloudy brown look of the river has become a light green—reflecting increased algae production due to how stagnant the water is.

One university scientist remarked that the high sediment load in the Minnesota River is a function of the relative youth of the river—it was only formed about 14,000 years ago, after the retreat of the most recent glacier sheet to cover Minnesota. The slumping of streambanks is the river’s natural process of achieving dynamic equilibrium. Left to its own devices, the river would eventually become much wider and shallower and the sediment load would drop dramatically. The scientist pointed out that riverside private property and other public uses make it undesirable to leave the river to its natural process. The science of managing streambanks, however, is also young.

When someone asked if anyone had considered riprapping the whole length of the Minnesota River—riprapping being the method of controlling erosion by putting a layer of rocks over that streambank—the scientist noted that the US Army Corps of Engineers studied a potential project to riprap 1,000 yards of the river near Rice Lake, and found that the cost for that one segment would be $1 million dollars.

 

Growers make the case for passing a new farm bill, and keeping RFS

Written by Jonathan Eisenthal

NCGA Corn Congress, held in Washington DC in July each year, is always an occasion for Minnesota growers to meet legislators and continue the conversation about what will help midwestern farmers keep the American system of raising food the envy of the world: an overwhelmingly safe supply of food available in every region at reasonable prices.

The two political issues that will impact U.S. food production the most in 2012 are a successful conclusion to the drive to pass a Farm Bill, and one of the chief agenda items for corn growers and ethanol producers–keeping the Renewable Fuels Standard intact, and allowing its built-in mechanisms to deal with issues of grain supply.

The 17 Minnesota growers met with the entire Minnesota delegate to Congress, as well as many members of the House Agriculture Committee.

“We told congress members we need to keep the RFS intact, let it work, it’s got provisions designed to handle scenarios like this,” said John Mages, a corn producer in Belgrade, Minnesota, and president of Minnesota Corn Growers Association. “RFS demands that so much ethanol be used each year. It’s important to remember that, at the beginning of the year, there was a lot of ethanol in surplus, also there is a credit called RINs (Renewable Identification Numbers) that the fuel blenders can use in the place of actual ethanol. Between those things we may be able to meet all the market demand. It’s important also to wait and see exactly how much corn we produce before the government resorts to drastic changes. One message we’ve been bringing to lawmakers is that once there’s a cut back on the mandate, it will be very hard to get back what’s been given it up. So we want to keep it going.”

Among those new to the process of visiting congress people in Washington and carrying the farmer message, were MCGA director Les Anderson and Anna Bellin, MCGA’s new policy director.

“Our message was straightforward,” said Bellin. “We want to get it done. Don’t mess with the RFS, because the market is working. It is easy to blame ethanol for the problems being caused by the drought, but we should be careful not to take apart energy policy that’s just beginning to deliver energy independence–let’s see what the actual corn production is.”

The grower leaders found the lawmakers receptive and supportive of the idea of getting a farm bill passed this year. The Senate has passed a version and now it is up to the House of Representatives.

The whole thing gets tied up in election year politics,” said Bellin. “Members of the ag committee were generally supportive of getting it done, but it comes down to being a leadership decision. A large part of the farm bill is nutrition program spending and that’s getting all tied up in debates about budget cutting.”

Whatever else gets done regarding farm policy, it appears likely that some kind of disaster program for livestock producers will pass, either as part of a regular farm bill, or failing that, as a stand alone extension.

But the farm program is an essential element — without it, farmers cannot plan for the coming crop year.

“Without a farm bill in place I don’t know a single banker that would make a loan to a farmer,” said Lori Feltis, a producer in Stewartville and a representative to the Minnesota Corn Research & Promotion Council.

However, success will require an eye to timing.

“It was our effort during our Washington visit to put as much pressure on the House to get it done as we could,” Bellin said. “Congressman Collin Peterson has been extremely supportive of getting it done. He is doing whatever he can to get it across the finish line and we really appreciate it. It’s our intent to keep the pressure on, but there’s also a delicate balance–while we are trying to get it done as quickly as possible, we also want to make sure the votes are there when it comes to a vote.”

MCGA helps race fans connect with ethanol

Written by Jonathan Eisenthal

MCGA staged four “Jam The Stands” events at stock car races across Minnesota during the last week of July, to reach race fans with a message about the positive impact of ethanol fuel on the economy and the environment in Minnesota.

With “Jam The Stands,” MCGA bought the entire grandstand section and offered free admission for the evening at each of the four tracks: KRA Speedway in Willmar, Fiesta City Speedway in Montevideo, Madison Speedway and Viking Speedway in Alexandria.

“Each of the races had about double the usual attendance,” said Chad Willis, a farmer in Willmar and past chairman of the Minnesota Corn Research & Promotion Council.

In return for bringing in the big audience, MCGA had the chance to deliver the facts about ethanol. The track announcers played trivia games with the crowd. Volunteers from the local corn grower groups sold specially made t-shirts with “Jam The Stands” logos. 

Among the trivia and “did you know” questions, the audience learned that ethanol reduced gasoline prices an average of $1.09 per gallon in 2011 in the Midwest (source: Iowa State University study) and that ethanol plants directly provide high wage jobs for 8500 people in small towns across Minnesota. They also learned that corn is Minnesota’s largest crop at 1.2 billion bushels, and 95 percent of the farms that produce it are family farms.

“As a marketer you want people in the stands and ‘Jam The Stands’ definitely did it,” said Willis. “You get the message out, engaging the crowd before and between the races, and you get a chance to talk about the benefits of ethanol to Minnesota and the nation. It’s very effective. We had lots of people coming up to us and thanking the corn growers for the free admission. There were lots of families. With these events, from the track’s point of view, you want to create new race fans. The fact that so many kids come with their families helps the tracks build their future audience.”

The t-shirts have been a popular item since MCGA began sponsoring the ‘Governor’s Ethanol Challenge.’ Shirts from the previous seven years were visible throughout the stands at all four race evenings. This is the first year of the new marketing concept, Jam The Stands. The bright green shirts with orange highlights offered the message: “Jam The Stands: From Field To Fuel.” The back of the shirt showed race cars with numbers 20 and 12, to show the current year.

“Seeing all the previous years’ shirts and all the Jam The Stands shirts out in the crowd you can instantly see that the shirts are an ongoing message, which makes them a super marketing tool.”