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8/18/2008 - 8/24/2008

Pre-harvest Restrictions for Fungicides

By Daren Mueller, Department of Plant Pathology
With the buzz of airplanes still being heard out in the countryside and September within sight, this is just a quick reminder to growers about the pre-harvest intervals (PHI) for fungicides applied to corn and soybean. Last month in Kansas, some wheat was embargoed when fungicide levels were questioned until tests could be completed to determine residue levels.

Pre-harvest Interval (PHI) is the minimum amount of time that must pass between the last pesticide application and the harvesting of the crop, or the grazing or cutting of the crop for livestock feed. Typically, PHIs for fungicides applied to field crops range between 21-30 days.

Some triazoles and triazole + QoI fungicides have restrictions based on growth stages instead of a specific number of days; fungicides cannot be applied later than soybean growth stage R5 for soybean or after silking for corn. 

PHI chart


 

Daren Mueller is an extension specialist with responsibilities in the Corn and Soybean Initiative.

Changes in Retail Fertilizer Market Impact Producers

By Roger Ginder, Department of Economics
Major change in retail fertilizer markets over the past three years include price volatility and price increases. But, in addition to the unprecedented price volatility, basic changes in the trade practices at the manufacturing, wholesaling, and retail levels in the fertilizer value chain are affecting producers.

Shift to global industry
Some date the start of the changes to 2003-2005, when the two large farmer-owned manufacturing firms, Farmland Industries and CF Industries, exited the industry. But the transition of fertilizer manufacturing from a North American mid-continent industry to a more global industry had begun in the mid to late 1990s. Nitrogen fertilizer manufacturing  is now a global industry.

Relatively low natural gas feedstock prices in the Former Soviet Union (FSU) and the Middle East favor more offshore production of nitrogen product. But the need to ship the finished product over a much longer distance means that the lead time required between manufacture and delivery is much longer.

It also means that international exchange rates become a factor in fertilizer pricing. The significant decline in the dollar’s value  earlier this year resulted in stronger grain prices, but it also increased the import price for many fertilizer products.

Inventory pricing changes
The exit of Farmland and CF coincided with a radical change in trade practices at the manufacturing and retailing levels. The production of these farmer-owned firms was more-or-less committed to the U.S. markets and to a great degree committed to the cooperative distribution system. They were willing to undertake the inventory risks and provide a great deal of stability in retail markets. 

Inventory was manufactured more or less continuously and moved down the logistics channel to the wholesale and retail level in advance of the season.  Much of the inventory moved into retail warehouses was un-priced and there was no commitment to price it before the local cooperative decided to price it. Requests to change fertilizer products even after they were priced were often honored.  These policies provided producers and local cooperatives with maximum flexibility and influenced  the trade practices of other manufacturers and local retailers in the market. 

The remaining manufacturers are no longer willing to absorb this inventory price risk. Retailers have been required to place orders and pay for product prior to manufacture. In essence manufacturers have pushed the inventory price risk down the chain to wholesalers and retailers. Because there is no effective way to hedge fertilizer products, there is no good mechanism for retailers to manage the inventory price risk they are forced to accept.

Some of the added inventory risk has been absorbed at the wholesale and retail levels. But doing that is very similar to holding an un-hedged grain inventory; a large risk that few are willing or able to undertake. The magnitude of this risk has increased twofold or in some cases threefold as fertilizer prices have skyrocketed. Those who lend operating capital to retailers for inventory financing are no longer willing to do so under these circumstances.

Retail Market Impacts
This creates a much changed retail marketplace for producers who, up to now, have incurred some price risk as they purchase their fertilizer product. The price could be higher if they have not priced their tons or it could fall after they have committed to a price. Most producers are accustomed to this kind of risk and routinely accept it. 

But going forward producers will face the added risk of product or supply availability. With retailers unable to afford financing large inventories of un-priced fertilizer there is no assurance that enough product will be available when demand is high. If producers do not place an order and price the product well in advance, it may not be available when they need it.

An additional change in trade practices has evolved during the past 12 months at the wholesale level. Unlimited fertilizer supplies are no longer being offered to retailers from all manufacturers on a continuous basis. Defined quantities or "blocks" of product are being offered on an intermittent basis to retailers. In many cases these quantities are less than the retailer would prefer to purchase or could sell promptly.

Keep communicating with dealer
This means that the retailer may no longer be able to offer a price for fertilizer product to all customers on a daily basis. Sales can be made only to the extent product has been made available for the retailer to purchase. While that quantity may be adequate to promptly fill some customer orders, it may be inadequate to meet all customer demand at the time. 

Whether or not this is a permanent change in trade practice is unknown at this time. For the near term, producers need to be aware that filling their fertilizer needs the coming year may be different than the past. There is less opportunity for producer price shopping when manufacturers require prepayment from the dealer and offer smaller quantities of product to dealers more frequently. Maintaining an ongoing relationship and more frequent communication with the dealer about supply becomes as important as searching the market for the lowest price.

 

Roger Ginder is a professor of economics with extension responsibilities.

A Final Soybean Aphid Alert

By Jon Tollefson and Marlin Rice, Department of Entomology

For supposedly being a soybean aphid “off year”, the aphids have been doing surprisingly well during August. Typically the aphid numbers are declining at this time of year because the soybeans are approaching maturity and the temperatures are quite warm. However, this year is slightly different from recent years and you should not let down your guard.

There are a couple of reasons to stay on the alert for soybean aphids. One is the later planting dates for many soybeans. The other is the cooler than normal weather.

The soybean aphid is not expected to cause any additional yield loss after soybeans reach R5.5 stage. The R5.5 stage is between the R5 stage, when the seed is 1/8 inch long in the pod at one of four uppermost nodes on the main stem, and the R6 stage, when the pod contains a green seed that fills the pod cavity at one of the four uppermost nodes on the main stem.

At the R5.5 stage, the canopy should be closed in the bean fields and there will not be any additional gain from spraying for aphid control. However, with the cool, wet spring and summer this year some fields were planted quite late and the maturity of the beans has lagged behind. As a result, you need to continue to scout soybeans for aphids in fields where the canopy has not closed across the rows.

The second reason scouting should continue is the cool weather. As long as the daytime temperatures stay in the 70s and low 80s, the aphids will continue to reproduce and feed. They will not begin to move to overwintering sites until there are shorter days and night-time temperatures drop into the 40s.

Therefore, continue to scout aphids in any soybean fields that have not reached maturity stage R5.5 and while the temperatures stay cool. Don’t forget to recheck fields that were sprayed two weeks or more ago. These sprays will have destroyed the predator populations and the chemical’s residual activity will have ended by now; aphid numbers may be rebounding in those fields.

 

 

Jon Tollefson is a professor of entomology with extension and research responsibilities. Marlin E. Rice is a professor of entomology with extension and research responsibilities.

Fill ‘er Up!

By Rich Pope, Department of Plant Pathology

In a season that started with weather tumult fouling up the planting season in many areas, we have done pretty well in getting the corn and soybean to reproductive stages. Degree days remain behind long-term averages as of August 17.

Iowa map for degree day accumulations
But now the focus is on grain fill. The cooler than normal weather of the last two weeks are potentially beneficial, as the cool nights tend to stretch out the grain-fill period. The longer the plants stay functioning, the more dry matter can be stored in the grain. That is, as long as plants avoid an early killing frost. Normal killing frost dates in Iowa are around the first of October in northern Iowa and about the 10th of October in the south. Two weather factors that will help  enhance corn yields in the next six weeks are ample sunshine and rain, to avoid moisture stress.

For the fun of it, I prepared a chart of base-50°F degree-day accumulations through the 2008 growing season to date for central Iowa. Our degree-day deficits have pretty consistently lagged the long-term average by about 7 to 8 degrees per week. Of course, it bears mention that degree days gained when the seed was in the bag don’t count. In some areas this accounts for a considerable share of the acres and explains much of the variability in crop development.      
 Graph of degree days in the 2008 season

 

Rich Pope is an Extension specialist working in the Corn and Soybean Initiative



This article was published originally on 8/25/2008 The information contained within the article may or may not be up to date depending on when you are accessing the information.


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