Ohio Ag Manager Team Recognized on the A-List of Top Sites on Internet by Agriculture.com

The Ohio Ag Manager team was recognized at the conclusion of 2010 by the agriculture web site Agriculture.com (http://www.agriculture.com/) as one of their Top Ten Internet Sites for 2010.

Agriculture.com began publishing their [A] List of best agricultural features on the Internet in July of 2010. The [A] List includes websites, blogs, social media postings, user comments and other Internet-based content developed by agribusinesses, agricultural media, and farmers. The list was developed by this web site based on the idea that farmers and other agriculturalists are busy people and will appreciate guidance in finding useful and entertaining information.

“All the links on the [A] List are considered top drawer,” says Successful Farming and Agriculture.com Editor-in-Chief Loren Kruse. “But our staff also felt there are some features that deserve to be short listed.”

The Ohio Ag Manger Team’s team is very pleased to be recognized by Agriculture.com as one of their top ten sites for 2010!

The complete article published by Agriculture.com can be found at:
http://www.agriculture.com/news/technology/best-of-a-list-ten-top-picks-from_6-ar13264

Grain Market Update Webinars hosted by OSU Ag Outlook and Policy Program

The Ohio State University Agricultural Outlook and Policy Program would like to invite you to view upcoming Webinars on Grain Markets.

There are seven scheduled events:

January 19, 9:00am
February 14, 9:00am
March 15, 9:00am
April 12, 9:00am
May 12, 9:00am
June 13, 9:00am
July 13, 9:00am

To register and view the event, please follow the link:
http://aede.osu.edu/programs/outlook/zulauf/Demand-SupplyWebinars.htm

For information on the overall Policy & Outlook Program, visit our website online at http://aede.osu.edu/programs/outlook or contact Stan Ernst at Ernst.1@osu.edu or (614) 292-6421.

Vineyard Expansion Assistance Program Provides Grant Money to Ohio Grape Growers

REYNOLDSBURG, Ohio (Jan. 6, 2010) – Thirty Ohio grape growers will soon receive $2,000 grants provided by the Vineyard Expansion Assistance Program. Ohio vineyards will receive these grants funded by the Ohio Department of Agriculture through the U.S. Department of Agriculture’s Specialty Block Grant program and the Rural Rehabilitation Fund.

The Vineyard Expansion Assistance Program grants are offered in the form of reimbursement for grape vines only, encouraging grape growers to establish new wine grape vineyards and expand existing vineyards.

“Ohio’s grape and wine production is a thriving industry that employs more than 4,100 Ohioans,” said Ohio Agriculture Director Robert Boggs, chairman of the Ohio Grape Industries Committee. “The Vineyard Expansion Assistance Program helps this industry to contribute more than $580 million to Ohio’s economy and to continue to be a successful industry within our state.”

The program will allow for a more stable source of grapes for Ohio’s grant recipients by allowing each grower to plant an additional acre of high-quality, high-value grapes. It will enable more Ohio wines to qualify for the Ohio Quality Wine program that identifies the best Ohio wines that are made using 90 percent or more Ohio-grown grapes.

The Vineyard Expansion Assistance Program is managed by the Ohio Grape Industries Committee, which was created in 1982 and operates in-part through the Ohio Department of Agriculture. The committee provides marketing and research opportunities to Ohio’s wineries and vineyards and helps increase consumer awareness of Ohio’s modern, high-quality wine industry.

Cover Crops Part of 2011 Conservation Tillage Conference

With dozens of cover crop varieties available with a whole host of benefits ideal in a number of cropping systems, choosing the right variety for the farm can be a daunting task. Farmers interested in cover crops will have a daylong educational session on cover crop management available at the Conservation Tillage and Technology Conference (CTTC) in Ada.

The CTTC will be held Feb. 24-25 at the McIntosh Center of Ohio Northern University in Ada. The cover crops sessions will be held Feb. 24 from 8:00 a.m. until 5:30 p.m. Farmers attending this session are invited to stay for a cover crop meeting and networking, starting at 6:00 pm.

Randall Reeder, an Ohio State University Extension agricultural engineer and organizer of the conference, said that the cover crops session is an opportunity for growers to learn about the benefits of cover crops, how they can incorporate the right cover crop into their cropping system, and how to manage cover crops efficiently and profitably. “Our goal is to increase cover crop acreage in Ohio by 5,000 acres,” said Reeder. “Cover crops offer much in terms of potential economic benefits as well as improvements in soil and water quality.”

Cover crops offer a myriad of benefits for field crops, especially in no-till production systems. They are excellent sources of nitrogen, have almost a 15:1 carbon-to-nitrogen ratio essential for maintaining soil quality, and they produce chemicals (allelochemicals) that are antagonistic to soil-borne diseases and pests. Cover crops also fit in well with field crops because of their short rotation and winter cover. Many cover crops are killed off by winter weather, eliminating the need to use herbicides for burn-down.

Ohio State University Extension research has found that legume cover crops incorporated into a continuous no-till field crop rotation can produce enough nitrogen to complement, or in some cases, replace corn nitrogen fertilizer applications. In addition, cover crops improve the soil structure, support microbial diversity, facilitate drainage, reduce soil erosion, reduce nutrient leaching, store carbon, suppress weeds, enhance wildlife and can serve as a forage for livestock.

Speakers from across the Midwest and Canada will cover fourteen topics including research on oilseed radish varieties; tools to choose the best cover crops for the farm; practical cover crops for corn-soybean rotation; earthworms and their ability to build organic matter; survey results of why farmers don’t plant cover crops; and using cover crops to improve water quality. A panel of farmers will show how they incorporate cover crops into their operations.

Speakers include Dave Robison of Cisco Seeds; Dale Mutch and Dean Bass from Michigan State University; Ann Verhalen from Ontario, Canada; Odette Menard from Quebec, Canada; Barry Fisher from NRCS in Indiana; and Glen Arnold, Rafiq Islam, and Jim Hoorman from Ohio State University Extension. Sponsors include Ohio State University Extension, the Ohio Agricultural Research and Development Center, Northwest Ohio Soil and Water Conservation Districts, USDA Natural Resources Conservation Service, USDA Farm Service Agency, and the Ohio No-Till Council.

The Conservation Tillage and Technology Conference is the largest, most comprehensive program of conservation tillage techniques in the Midwest. About 60 presenters (farmers, industry professionals, and university specialists) from around the country focus on cost-saving, production management topics. The conference is broken down into tracks covering soil and water; nutrient and manure management; advanced scouting techniques; cover crops; crop management; and planters and precision agriculture.

Elwynn Taylor, Iowa State University agricultural climatologist, will be the speaker for the opening general session at 9:30 a.m. on Feb. 24. Note that the cover crop session starts at 8:00 a.m., and is concurrent with the general session. The “Corn College” and “Soybean University” will be two other intensive programs to select from at this year’s CTTC.

Early registration is $50 for one day or $70 for both days. At the door, registration is $60 for one day and $85 for both days. Complete registration and program information is available at http://ctc.osu.edu.

The Conservation Tillage and Technology Conference broke an attendance record in 2010 with 966 farmers, crop consultants and industry representatives attending the event.

Crop Input and Land Outlook 2011

Crop profitability prospects for 2011 are positive for the three major row crops in Ohio. Input costs have increased from last year but increases in commodity futures crop prices for the 2011 crop year have increased substantially as well. Enterprise budget projections show positive returns for corn, soybeans and wheat in 2011. These budgets are available online at:
http://aede.osu.edu/Programs/FarmManagement/Budgets/index.htm

OSU Extension Budgets show projected variable (cash) costs for corn production to be 16% higher in 2011 than 2010. Soybean variable costs are projected to be 10% higher in ’11 than ’10. Wheat variable costs are projected to be 13% higher in 2011. Higher commodity prices and profitability in 2010 and projected net profits in 2011 will lead to cash rental rate increases for 2011.

Higher commodity prices and higher costs lead us to a riskier production year as the cash investment in an acre of corn will top $350 and in some production scenarios be closer to $400 per acre. The cash investment in an acre of soybeans will be in the $200 range.

Outlook information presented here was developed with data from AEDE research, Energy Information Administration, USDA, other Land Grant research, futures markets and retail sector surveys.

Fuel
As of December 7th, the Energy Information Administration (EIA) pegged the average price for West Texas Intermediate Crude Oil at $86.10 per barrel for 2011. This is a 9% increase over the 2010 Crude price.

The EIA projects the Henry Hub Natural Gas price to average $4.33 per MMBtu in 2011. This is approximately a 1% increase over the 2010 natural gas price.

Fertilizer
Fertilizer continues to be the most volatile of the crop input costs and cost management of this important input may be the difference in being a low cost or high cost producer in 2011. Fertilizer prices were relatively flat through July of 2010. Since August fertilizer prices have increased substantially. A number of factors have led to the rapid increase in these fertilizer prices. First, due to relatively low crop prices through mid-summer, fertilizer manufacturers were not producing at full capacity anticipating a flat global demand for fertilizer through the fall of 2010 and into the spring of 2011. This relatively empty pipeline together with an early harvest in the U.S. Corn belt and much higher prices for major row crops has led to the higher fertilizer prices that we are now experiencing. Higher prices for corn, soybeans and wheat have signaled the global marketplace to increase acreage (bringing marginal acres back into production) and increase fertilizer rates on all acres. Higher energy prices have also put upward pressure on all fertilizer prices due to the higher mining, manufacturing and transportation costs.

Nitrogen (N)
U.S. demand is projected to be 12.9 million tons in 2011 compared to 11.8 million tons in 2010.

The U.S. imported approximately 15% of our nitrogen needs for crop production in 1980. Today, the U.S. imports approximately 48% of our nitrogen. This highlights the importance of the world supply and demand as we try to evaluate price direction of nitrogen fertilizers.
The retail price of N in December in Ohio was $750-800/ton for anhydrous ammonia (75-87% increase over year ago), $320-385/ton for UAN (28%) (50-82% increase over year ago), and $480-500/ton for urea (25-32% increase over year ago).

Nitrogen fertilizer manufacturers are presently operating at profitable levels due to higher N prices and relatively low natural gas prices, but this fact hasn’t led to supply outstripping demand as the entire supply chain has been more cautious in getting caught in a repeat of the 2008 upside-down fertilizer market.

With the high correlation of nitrogen price to corn price, future movements in nitrogen prices will more than likely take their cues from movements in price of corn.

Phosphorous (P2O5)
The retail price of phosphorous fertilizers are much higher over year ago prices. DAP in December in Ohio was $660-690/ton (80-88% increase over year ago) while MAP was $670-700/ton (68-75% increase over year ago).

Phosphate rock, sulfur and anhydrous ammonia, all primary ingredients used in the manufacture of P fertilizers are presently high priced and have contributed to higher P fertilizer prices.

These higher ingredient prices along with strong world demand continue to pressure phosphorous fertilizer prices. These pressures signal continued higher prices for the 2011 crop production year.

Potassium (K20)
The retail price of potash in December in Ohio was $500-550/ton (10-15% decrease from year ago).

The potash industry essentially operates as a duopoly (two firms, in this case, two consortiums, with dominant control of the market) with Canpotex (Canadian Potash Exporters) and Bellarussian Potash Co. controlling much of the global potash supply.

Potash prices will likely remain steady to higher into 2011 as high crop prices will translate into continued strong demand while the two major potash consortiums will meter out supply to keep prices stable.

Fertilizer Buying Strategies
Storage Approach
To take advantage of “lows” in the market during seasonal lows or unforeseen dips in the market, building storage for your N, P and K needs may be an option to consider as these fertilizer prices remain volatile.

Price Averaging Approach
As fertilizer price remain high and volatile it may be wise for producers to spend more time on pricing these critical inputs. Spreading out your purchases and buying N, P, and K at several different times should result in a better price average over the long run as you average your high priced purchases with your low priced purchases. The only drawback to this option is the inability to take advantage of volume discounts if you are spreading your purchases over several different buying opportunities instead of buying product in one large volume.

Farmland Values and RentsCropland values in Ohio have increased in 2010 due to profitability in crop production. These profits have led many farmers to seek an investment option for these $’s and many have turned to land. Investors outside of agriculture have also been looking at farmland as a stable investment to add to their portfolios. With many $’s and buyers chasing farmland it isn’t a surprise to see land values increase substantially in 2010 (Iowa State reported in November that Iowa farmland increased in value 16% from last November. Ohio increases are likely similar.) Low interest rates and the relative scarcity of farmland up for sale have also helped drive land values higher.

So all of this begs the question, “Where are land prices headed this year?”

The case is strong for land values to see continued strength in 2011 as profitability prospects are very good for this upcoming crop year. Producers and other investors outside of agriculture will continue to see farmland as a good investment alternative. With strong balance sheets many farmers will continue to be in the land buying mode.

Cash rental rates will seem similar upward pressure as higher commodity crop prices and good prospects for profit in 2011 drive competition in local markets.

Seed and Crop Protection Chemicals
Seed company data indicates price for 2011 to be mostly flat among similarly traited seed. Farmers should carefully consider the need for these seed traits by evaluating University and company plot research.
Crop protection chemicals prices have remained fairly flat over the last 2 years. Glyphoste, the leading crop protection chemical in terms of use in the world still continues to flat prices.

Glyphosate production is energy and capital intensive, but not labor intensive. Thus, China has no competitive advantage in glyphosate production. There’s no sizeable domestic demand for glyphosate in China as the Chinese market is relatively small. Chinese producers have been encouraged by China’s government to expand their capacity to capture export markets around the globe, says Vance.

Their government does this by granting export incentives such as tax rebates to glyphosate producers. Also, lack of wage and environmental standards in China and an undervalued Chinese currency all effectively subsidize unfair trade and pricing practices.

Continued high prices of petroleum products (main ingredients in many crop protection chemicals) will pressure prices to move somewhat higher.

New Safety Rules for Private Intrastate Non-CDL Drivers

The Public Utilities Commission of Ohio (PUCO) has revised its rules relative to motor carrier transportation safety. The new rules apply to businesses that use vehicles with a gross vehicle weight (GVW), gross vehicle weight rating (GVWR), or gross combination weight rating (GCWR) of 10,001 to 26,000 pounds to transport property or passengers on a not-for-hire basis in Ohio.

There have been several questions from farmers about how they will be impacted by these rule changes.

The PUCO regulation change results in intrastate, non-CDL private motor carriers being subject to the same laws as other larger trucks. (Non-CDL is 10,000 – 26,000 lbs). However, these new rules will still not apply to farm trucks which remain in Ohio because the definition of private motor carrier, and for that matter motor transportation company, specifically does not include those trucks “engaged in the transportation of farm supplies to the farm or farm products from farm to market.” So there is no change in compliance for farmers who are hauling supplies or products. The interpretation is that this is only for transport of your own farm products/supplies, not for-hire transportation or hauling.

Here is a link to the two definitions:
ORC 4921.02 See definition of “Motor Transportation Company”: http://codes.ohio.gov/orc/4921.02

ORC 4923.02 See definition of “Private Motor Carrier”:
http://codes.ohio.gov/orc/4923.02
If you have any questions, I would encourage you to check the links listed above for detailed information about the rules and definitions.

Farmer’s Tax Guides Available at OSU County Extension Offices

Do you need a resource to answer those tough farm tax questions? If so, farmers can receive a free copy of IRS Publication 22, the 2010 Farmers Tax Guide, at their local county OSU Extension office. The 2010 Farmer’s Tax Guide is an 89 page publication which explains how the federal tax laws apply to farming. This guide can be used as a guide for farmers to figure taxes and complete their farm tax return.

Some of the new topics for the 2010 tax year which are included in this publication are: standard mileage rate, increase in deduction for start-up costs, limitation on excess farm losses, increased section 179 expense deduction dollar limits, extension of special depreciation allowance, property eliminated from definition of listed property, decrease in personal casualty and theft loss limit, disaster losses, self-employed health insurance deduction, and wage limits for social security tax. More information can be found at the IRS website at:
http://www.irs.gov/publications/p225/index.html

The Rural Tax Education Site has an example Schedule F on their web site to help producers as they complete their Schedule F. The sample return can be found on web site at: http://ruraltax.org/
Click here to find the location of the OSU Extension County Extension offices

Click here to access a printable PDF version of the 2010 Farmer’s Tax Guide