On the Trail for Trends

On the Trail for Trends

Commodity Classic serves up ag’s “next big things”

Hungry for industry trends? Commodity Classic is consistently one of the best places to get your fill.

This year marked the event’s 20th anniversary. In record-breaking style, 7,900 attendees descended on Phoenix. They did more than soak up the sun. Attendees also soaked up information on agricultural issues and products that will affect their farms’ bottom lines in 2015 and beyond.

To help farmers improve underperforming fields, 
FarmLink’s managing director Randy Baker says his company helps benchmark field performance.

Emerging technologies were a hot topic, as farmers continue to ponder drones, big data and other high-tech solutions. For example, Matt Rohlik, who divides his days as the integrated solutions manager for Haug Implement Co. in Willmar, Minn., and a diversified crop farmer, says drones have tremendous use in crop scouting and decision making.

“Right now, when you scout a field, you only see at your height,” he says. “But looking at fields from far above brings a different perspective. We have an opportunity with drone technology to take a look at our crops—weekly if we really wanted—and adjust fertilizer and water. Also, we can watch cattle with drones and make sure they’re in the pen and accounted for.”

Several companies were on hand to showcase how data analytics can help farmers reap bigger profits. FarmLink deploys technology using collected harvest data and sorts it into 150-sq.-ft. microfields, approximately the footprint (5'x30') that a combine harvests per second. Those microfields are then matched and assigned a performance percentile of 0 to 100.

According to a recent revenue report by FarmLink, U.S. farmers left an estimated $9.5 billion worth of profits in underperforming fields. That’s the unmet profit potential that could have been gained by moving those acres into the 75th percentile.

“The innovative grower wants to increase bushels, but in a manner that is profitable,” says Randy Baker, FarmLink’s managing director. “We want to help create actionable items.”

For some farmers, the barrier to discovering actionable items comes down to what data has or hasn’t been 
collected on his or her operation. FarmLogs is attempting to take away that particular excuse with its new 
Advantage program.

“Even if you haven’t been collecting data on your farm, we can now unlock five years’ worth of data on your fields,” says Jesse Vollmar, CEO and co-founder. “Some farms have been using precision ag for years. This is a way to get everyone on board.”

The company used commercial multi- spectral data at five-meter resolution that had been collected for use in other industries and redeployed it for agriculture. Using this data, FarmLogs set a performance baseline for each field and built various crop monitoring and growth stage analysis tools to improve in-season decision making.

The Climate Corporation continues to upgrade services on its free Climate Basic web and mobile app. Changes include a simpler user interface, an upgraded notifications system and additional scouting functionality.

“This year in Climate Basic, farmers can easily identify historical and predictive rainfall, crop growth stage, and current and future radar from their home screen,” says Gary Rudolph, senior director of mobile engineers. “Farmers will be able to add scouting notes easily in the field, add photos to their notes and share scouting records with their agronomist, retailer or other trusted advisor.”

The Climate Corporation is also reducing its fee from $15 to $3 per acre.

As data analysis gets more sophisticated, precision ag needs to make the service agreements more simple to understand. This is according to Case IH, who surveyed 331 producers with 1,000 acres or more farmland in January about data collection and usage on their farms. Based on the results, it’s clear big data has a looming “I don’t know” problem in farm country.

“We were interested in the awareness—or unawareness—of farmers and data ownership,” says Trevor Mecham, director of precision solutions, Case IH. “There were a lot of ‘I don’t knows’ at the end of the day.”

For example, farmers were asked: “Does your ag data system provider agreement limit their ability to sell or share your data?” While 45% said yes and 20% said no, more than a third (35%) said they didn’t know. Mecham says farmers as well as the precision ag industry can help eliminate confusion. For farmers, it starts with reading their service agreements.

“Know what you’re signing up for, know what you’re signing over and know what data stays with you,” he says.

It’s also on precision agriculture providers to clarify and simplify usage agreements, Mecham adds. He points to the Open Ag Data Alliance and other groups already working on these and other standards.

Another source of confusion is simply not having standard definitions surrounding farm data, he says. For example, Case IH defines “agronomic data” as separate from “machine data,” but not all OEMs make this distinction. Mecham says Case IH is focused on increased transparency for data collection and usage issues.

Agronomic and marketing advice was also doled out in spades at the learning center sessions. Missouri farmer Kip Cullers and Florida farmer Dave Hula were on hand to share their advice on “championship corn and soybean yields.”

Florida farmer Dave Hula shares agronomic and management tips for growing 400 bu. per acre corn.

Hula follows a five ingredient recipe for success. First, have a good attitude and be open-minded, he says. Next, learn what you can control. Soil, fertility and pest management are within each farmer’s grasp, he says. Master the mechanics of planting, spraying and harvesting. Fourth, find the best hybrids for each fields. Fifth, manage your crops by developing plans, executing them, adjusting them and evaluating the results.

High yields are for naught if you don’t bring them full circle with marketing. Dave Fogel, vice president of Advance Trading, Inc., warned farmers against price speculation, focusing instead on price protection—comparing grain marketing to watching a movie that’s only halfway through.

“There are really smart guys who can tell you what’s happened before, and why, but they can’t tell you what will happen next because they haven’t seen the rest of the movie,” he says.

Asking why commodity prices are up or down is not the best question to ask, he says. Instead, ask questions such as, “If commodity prices are up tomorrow, what should I do?”

“The No. 1 question that doesn’t get asked is “what if ?” he adds. “That’s why marketing can be so difficult. We tend to wing it and take chances all the time. We shouldn’t mistake marketing with speculation,” Fogel advises. 

Fogel suggests farmers focus on the following three items:

  • Know how marketing tools work.
  • Know crop insurance options.
  • Know when cash markets work to your advantage—and when they don’t.

On a special live taping of “U.S. Farm Report,” the market talk continued with a roundtable discussion among marketing experts. Chip Nellinger, risk management consultant at Blue Reef Agri-Marketing, says this isn’t the year to do nothing. “You need to have a plan. You need to manage the risk and take advantage of rallies when we have them,” he notes.

Chip Flory, Pro Farmer editorial director, was quick to agree with this advice: “We’re back to more normal conditions, tight margin situations. If you’re above breakeven, take advantage of those opportunities when they come along and lock in a 5% to 7% return on your investment.”  

By Jeanne Bernick

Immediate Action Needed on Western Drought

At the Bayer Ag Issues Forum, from left, David Modeer, Bill Hohenstein, Frank Sesno, Larry Clemens and Jay Hill participated in a panel discussion on water mitigation.

Western agriculture is on the verge of a showdown that could rival the best gunslinger movies. The current drought directly affects more than 64 million people in the Southwest and Southern Plains, according to government statistics, and many more are indirectly affected because of the impacts on 
agricultural regions. 

As a result, Western states have imposed water restrictions, aquifers have been drawn down and reservoirs, such as Lake Meade and Lake Powell, are at historically low levels. 

According to the U.S. Drought Monitor, 11 of the past 14 years have been drought years in the Southwest. The biggest headlines this year—and the worst levels of drought—can be found in California, but most of the region has been suffering from a persistent lack of rain and snow. 

The impact of water shortages on agriculture was the topic of a panel discussion at the Bayer Ag Issues Forum in February in Phoenix. 

“This drought has been ongoing for nearly two decades in Arizona with precipitation below normal,” says David Modeer, general manager, Central Arizona Project. “Reservoirs are helping, but no one ever expected we would be going into a 17-year drought. Levels at storage reservoirs are critical, and we are going to see shortages for those using water out of Colorado River.” 

The first shortage level in 2016/17 will substantially hit agriculture in Arizona, Modeer says. More than 75% of all water use in Nevada, California and Arizona is agriculture. 

Jay Hill, a second generation farmer who operates Hill Farms in southern New Mexico, is already seeing economic impacts on his vegetable operation and in the community. “When you cross the bridge over the Rio Grande River to visit Hill Farms, you now see people playing sand volleyball,” Hill says. “It’s completely dry. Yet Hill Farms still has to pay its water district bills. I had no idea growing up there would be no water.” 

During the past 10 years, Hill has paid higher fuel costs to pump water for irrigation, and the price of ground water has doubled. “That will put barriers on what we do,” he says. “We may pull pecan trees that have been in production for 40 years.” 

One solution is a multi-stakeholder effort on climate-smart agriculture, says Bill Hohenstein, director, Climate Change Program Office, USDA. That effort is focused on three things:

  • Population growth. “We need to feed people, so [the] solution involves taking advances we have made for ag productivity and increasing that,” Hohenstein says. “Genetics are going to play a role, as will technology transfer.”
  • Resilience, and the role ag plays as a source of long-term soil resilience. 
  • Partnerships, both with municipalities and inside agriculture between farmers and industry. 

“We recognize the problem is long-term,” Modeer adds. “The urgency is getting greater as the months go by.” 

By Jeanne Bernick

Partner With Supplier to Mitigate Farm Risk

Risk and uncertainty in agriculture are as old as the industry itself. Many unknowns present themselves during a given growing season. 

In recent BASF grower research, the company found a large majority is concerned about price fluctuation and yield uncertainty. More than half surveyed agree or strongly agree that crop protection companies should partner with them in risk management, notes Scott Kay, BASF vice president for U.S. Crop.

“If the majority of farmers agree risk sharing with a crop protection company would give them peace of mind, then we need to help with that,” Kay says. “We’ve created risk management initiatives to help them mitigate risk in markets, financing and even weather.”

BASF now offers its Grower’s Advantage lineup of risk management programs, which include:

  • Planning advantage. Purchase Headline AMP, Priaxor and/or Twinline fungicides from an authorized retailer by a set date and earn $50 per gallon. 
  • Finance advantage. Qualifying purchases through John Deere Financial receive a fixed 0% APR with no payments for a period of time.
  • Investment advantage. Buy at least 500 acres each of three products—one of which must be a fungicide—from a BASF authorized retailer, with a BASF High Yield Package, and if the BASF Established Harvest Price ends below the BASF Established Starting Price, you might receive a partial rebate of your qualifying High Yield Package product purchases. 

 “This is not a discount. This is a value-added thing that will help farmers manage their business,” Kay says. 

To learn more about the risk management programs, visit a BASF retailer or go to www.growersadvantage.basf.us.

For complete coverage of the 2015 Commodity Classic, visit www.AgWeb.com/CommodityClassic


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