Archive

Archive for May, 2012

Updated grain balance sheets available

May 30th, 2012

The grain balance sheets can be thought of as a commodity counter-part to financial balance sheets that center on the supply and demand for money that is available to a business, an individual, or other institution, and how much will be left after all demands for funds are met. The financial balance sheets focus on assets, liabilities, and net worth. In commodities, the focus is on available supplies, various sources of demand, and carryover stocks that are left at the end of the marketing year after all demands have been met.

Ag Decision Maker (AgDM)

An agricultural economics and business web site.

Crop Outlook, Renewable Energy

Input sought on Evaluating Your Estate Plan materials

May 29th, 2012

There is a new Ag Decision Maker category under Whole Farm – Transition and Estate Planning. Fourteen new Information Files were added to this category this spring and we want to know if they are helpful to you. We invite you to complete the online survey at http://www.surveymonkey.com/s/eyep2012. Survey responses take less than five minutes, participation is completely voluntary, and responses will be confidential. It is important to us to have your feedback – it will guide our decisions to update current materials and create new publications. The Information Files are developed with funding from a North Central Risk Management Education Center grant.

If you have any questions on this evaluation or the Evaluating Your Estate Plan materials or program, please contact us at agdm@iastate.edu or call 641-732-5574. These Information Files are created for your use – please complete the survey so we can provide the information you need in our publications and program.

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Succession

DOT regulations: lighting and towing

May 25th, 2012

Kristen Schulte, ISU Extension and Outreach Farm & Agribusiness Management Specialist

It is important to occasionally review Iowa Department of Transportation guidelines when hauling and moving agriculture implements and commodities. The following guidelines are taken from the Iowa Department of Transportation Truck Information Guide; this publication can be accessed from www.iowadot.gov/mvd/omve. Additional questions should be directed to the Office of Motor Vehicle Enforcement, 800-925-6469.

Lighting and Reflectors

Motor trucks, truck-tractors, semi-trailers, and any other commercial motor vehicle must meet light and reflector requirements as outlined by federal regulations (FMCSR Part 393.11).  Additionally, farm trailers are subject to the same lighting and safety regulations as registered trailers. Non-commercial vehicles, farm trailers, and implements must meet requirements below and maintain the lighting and reflectors which they were equipped with when manufactured.

At all times between sunset and sunrise when operated on a public highway, self-propelled implements shall be equipped with at minimum the following lighting:

  • One lighted white headlamp visible to the front;
  • One lighted red tail lamp visible to the rear; and
  • One lighted amber flashing light visible to the rear.

At all times between sunset and sunrise when operated on a public highway, towed implements shall be equipped with at minimum the following lighting:

  • One lighted red tail lamp visible to the rear, located at the rear of the rearmost towed implement; and
  • If the visibility of the lighted amber flashing light on the towing implement is obstructed to the rear by the towed implement or cargo, an additional lighted amber flashing light located at the rear of the rearmost towed implement.

The required light devises must be visible from a distance of 500 feet. These lighting requirements are in addition to the slow moving vehicle sign requirement of farm tractors or equipment operating at speeds less than 35 miles per hour.

Towing Implements of Husbandry

Any vehicle requiring registration when towing any other vehicle or implement on the highway is required to be equipped with and use a drawbar and safety chain. When two implements are in tow, a drawbar must be used and a safety chain is not required but recommended.

Raw agriculture products include commodities such as, but not limited to, ag lime, grain, hay, livestock, raw milk, straw, and fruit. Implements of husbandry include vehicles or equipment designed for reconstructed for agricultural purpose and used exclusively in an agricultural operation. It includes farm tractors, combines, grain carts, wagons, or fenceline feeders (referred to as implements).

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Agricultural regulations

DOT regulations: weight regulations for agriculture

May 23rd, 2012

Kristen Schulte, ISU Extension and Outreach Farm & Agribusiness Management Specialist

It is important to occasionally review Iowa Department of Transportation guidelines when hauling and moving agriculture implements and commodities. The following guidelines are taken from the Iowa Department of Transportation Truck Information Guide; this publication can be accessed from www.iowadot.gov/mvd/omve. Additional questions should be directed to the Office of Motor Vehicle Enforcement, 800-925-6469.

Registration Weight Tolerance

In Iowa, all trucks and combinations are allowed to operate in excess of their license registration weight by up to 5 percent, but are not allowed to exceed the maximum gross weight listed for total wheelbase. However, if transporting raw agricultural products* trucks or combinations are allowed to operate in excess of their license registration weight by up to 25 percent, but are not allowed to exceed the maximum gross weight listed for total wheelbase. A provision has been added for this exception to allow processed grain (i.e. cracked corn) as a raw product if the corn is transported to the processing facility and immediately returned to the farm. Additionally, a farm plated truck transporting distiller’s grain is also included under the 25 percent weight tolerance waiver. These two exemptions, 5 and 25 percent tolerance, apply only in the state of Iowa; the one exception is in Minnesota the 25 percent tolerance stands for Iowa farm plated vehicles.

Gross Registration Exception – Lightweight Combination for Farmers and Private Carries of Livestock or Ag Commodities

A motor truck in combination with a trailer or semitrailer, operated by a farmer or private carrier hauling horses, with county level registration or special farm registration may qualify for a gross registration weight exception. If the weight of the truck with transfer weight of the loaded trailer applied is 6 tons plus tolerance or less, and the total gross weight of the truck, trailer, and cargo is 12 tons plus tolerance or less, the truck may be registered for 6 tons or less and qualify. If the truck or total combination exceeds weight limits, the vehicle must be registered for the combined gross weight.

  • Registration Exception including 25% Tolerance
    • Truck must be properly registered for 6 tons or less
    • Truck and transfer weight must not exceed 15,000 pounds
    • Combined gross weight must not exceed 30,000 pounds

Implements of Husbandry and Truck Highway Weight Limits

All motor vehicles except for implements must comply with legal and posted limits on roadways and bridges; when on an un-posted roadway or bridge, weight must comply with corresponding registration weight based on number and position of axles. Implements are exempt from legal limits of roadways and bridges, but must comply with posted weight limits on bridges. Wheeled grain carts, tank wagons, and fenceline feeders must comply with the seasonal axle limit or a 96,000 pound gross maximum on a legal roadway. Seasonal axle weight limits for these implements are 24,000 pounds per axle from February 1 through May 31 and 28,000 from June 1 through January 31. On a legal limit bridge, these implements must comply with 20,000 pound per axle or 80,000 pound maximum weight limit; on a posted weight limit bridge weight it must comply with posted weight limit. Tracked grain carts, tank wagons, and fenceline feeders or self-propelled floatation applicators have additional requirements that can be identified in the Iowa DOT information guide.

Oversize Loads

Indivisible loads and vehicles that transport indivisible loads which exceed legal dimensions or weight, may be eligible to be moved by permit if the government agency with jurisdiction for the highways on the route of travel authorizes the movement and issues an oversize or overweight permit. Single trip and annual permits are available, with different limitations on their use. Exceptions are permitted for wide loads transporting implements during day light hours on non-interstate routes. These trailers must be marked with amber lights and wide load sign recognition. Contact the Iowa DOT for additional requirements before transporting oversize loads.  

*Raw agriculture products include commodities such as, but not limited to, ag lime, grain, hay, livestock, raw milk, straw, and fruit. Implements of husbandry include vehicles or equipment designed for reconstructed for agricultural purpose and used exclusively in an agricultural operation. It includes farm tractors, combines, grain carts, wagons, or fenceline feeders (referred to as implements).

Ag Decision Maker (AgDM)

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Agricultural regulations

Call before you dig…

May 22nd, 2012

Melissa O’Rourke, ISU Extension Farm & Agribusiness Management Specialist

As pointed out on the Iowa One Call website www.iowaonecall.com , Iowa law requires farmers to notify Iowa One Call at least 48 hours prior to all excavation.  Saturdays, Sundays and legal holidays are excluded, so additional time must be allowed under those circumstances.

Excavation does not include what might be termed “normal” farming operations such as plowing, cultivation, planting and harvesting. However, other farm operations may be considered as excavations which trigger the Iowa One Call requirement.

Excavations in the farm setting include chisel plowing, sub-soiling or ripping more than 15 inches in depth, drain tile excavation and installation, terracing or digging.  Excavation also includes driving a post in a new location other than repairing a fence in its existing location.

There are all sorts of buried pipelines, telecommunications cables, and other types of buried facilities that may exist on farm property.

If a farmer fails to notify Iowa One Call, that farmer may face civil penalties and be held liable for damages caused to these buried facilities.

It is advantageous for Iowa farmers to comply with the Iowa One Call system because such compliance provides a liability exemption for farmland owners.

An owner of farmland used in farm operations (see Iowa Code section 352.2) who complies with Iowa One Call will not be held responsible for damages to underground facilities if the damage occurred on the farmland in the normal course of farm operation. Of course, the exemption does not apply if the landowner intentionally damages the underground facility or “acts with wanton disregard or recklessness” in causing damage to an underground facility such as pipeline or buried cables.

And farmers should not make any assumptions about the depth of a buried cable, pipeline or other facilities. 

It is easy to plan ahead and make the toll-free call to Iowa One Call to notify of the intended excavation.  Underground facilities will be marked with paint and/or colored flags to approximate the location of the buried facilities.  Iowa law allows for an 18-inch tolerance zone on each side of the marking, so excavation should be avoided within the tolerance zone.

If excavation is needed in the vicinity of the markings, additional guidance is available through Iowa One Call regarding how to safely accomplish the operations without causing damage or encountering hazards.

More information is available at www.iowaonecall.com.  The phone call is toll-free by either dialing 811, or calling 1-800-292.8989.

Ag Decision Maker (AgDM)

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Agricultural regulations, Legal & Taxes

Farmland rental rates show continued strength in 2012

May 16th, 2012

Contributed by William Edwards, extension economist

Anyone who is involved with the rental market for Iowa farmland knows that rental rates have been pushed significantly higher by the favorable corn and soybean prices that farmers have enjoyed since 2010. This trend continued in 2012.

Results from the most recent Iowa State University Extension and Outreach rental rate survey estimated that the average cash rent for corn and soybean land in the state for 2012 was $252 per acre, an increase of $38 per acre or 18 percent from last year. This is the largest one-year increase since the statewide survey was started in 1994. The second largest increase was in 2011, with an increase of $30 per acre. Average rents were higher in all nine crop reporting districts, with increases ranging from $57 per acre (26 percent) in north central Iowa to $16 per acre (9 percent) in south central Iowa.

Typical rental rates for land growing oats and hay were reported, as well as rental rates for grazing pasture and corn stalks. This year rental rates for letting people hunt on farmland were included, too.

The intent of the Iowa State survey is to report typical rents in force, not the highest nor the lowest values heard through informal sources. Rental values were estimated by asking over 3,000 people familiar with the land market what they thought were typical rates in their county. The number of responses received this year was 1,419. Of the total responses, 37 percent came from farmers, 28 percent from landowners, 16 percent from professional farm managers, 16 percent from lenders, and 3 percent from other professionals.

The Cash Rental Rates for Iowa 2012 Survey is available online as a downloadable document; from the Ag Decision Maker website.

Other resources available for estimating a fair cash rental rate include the Ag Decision Maker information files Computing a Cropland Cash Rental Rate (C2-20) and Flexible Farm Lease Agreements (C2-21). Both documents include decision file electronic worksheets to help analyze leasing questions.

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Farmland Leasing

Changes to Acreage Reports and Crop Insurance

May 13th, 2012

Contributed by Steve Johnson, Extension Farm Management Field Specialist.

Everyone who plants an insurable crop should be keeping track of what date you plant each field and how many acres were planted to that crop. That information has to be reported to your local Farm Service Agency (FSA) office on FSA Form 578; the acreage report.

 Some 2012 acreage certification and crop insurance changes to keep in mind:

  •  July 15 is the deadline for acreage certification for spring planted crops
  • Crop insurance billing date of August 15 – a penalty will attach for late payment of premiums not received by October 1
  • In certifying acres, the farm operator needs to report crops planted, practice (irrigated vs. non-irrigated), number of acres and planting date
  • FSA Form 578 needs to include the farm serial number, tract number and field number
  • FSA assigns each field a unique identifier called a Common Land Unit (CLU).

Across the Corn Belt, hundreds of thousands of farmers are finding that acreage reporting just got easier. However, many farmers can now report this data while viewing a map of each field boundary. CLU data is contained in the USDA’s Comprehensive Information Management System.

Approved Insurance Providers represent the crop insurance industry and they have access to this data and are already using it to assist clients. Some early findings indicate the crop insurance agents working with clients may be able to speed up the process of acreage certification and provide more accuracy.

Advantages of CLU Information

The initial intent of CLU reporting was for USDA agencies like the FSA and the Risk Management Agency (RMA) to have consistent information. Heading into the third year of this nationwide effort, producers are beginning to see some real benefits:

  1. Easier and likely more accurate, tracking of data using maps versus using just alpha numeric data.
  2. Map-based information can be compiled immediately following planting in advance of acreage certification with FSA and filing FSA Form 578
  3. It is easier for crop insurance adjusters to verify policies, adjust claims and make indemnity payments when viewing map-based information.
  4. CLU information integrates well with precision technologies and the use of planter and yield monitor data for reporting

Conclusion

Since the crop insurance billing date has been moved up to August 15, providing a copy of that acreage report well in advance of the July 15 deadline will assure timelier crop insurance data entry and receipt of your premium notice. The 2012 crop insurance premium is due in September. Anything received after October 1 incurs a penalty.

Consider working with your crop insurance agent in advance of acreage certification. This might provide an opportunity to use CLU information and move to map-based reporting. A farmer that has added additional land for 2012, or perhaps their FSA office has not assigned CLU identification to each field, may see additional time during acreage certification.

Contact your local FSA office regarding acreage certification and completion of FSA Form 578. Contact your crop insurance agent should you have particular questions or concerns regarding your coverage or potential access to CLU information and map-based reporting opportunities.

Source: USDA Risk Management Agency-Informational Memo IS-12-002 & Iowa Crop Insurance Providers, April 2012.

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Crop Insurance

2012 DCP & ACRE Sign-up ends June 1st

May 11th, 2012

Contributed by Steve Johnson, Extension Farm Management Field Specialist.

The USDA Farm Service Agency (FSA) is wrapping up enrollment for the 2012 Direct and Counter-Cyclical Program (DCP) and also the 2012 Average Crop Revenue Election Program (ACRE) Program. Sign-up began on January 23rd, 2012 and ends on June 1st, 2012.
 
The 2012 DCP and ACRE contract signatures for enrollment are also due by the signup deadline of June 1st.  It is the responsibility of the operator and owners of a farm to obtain and submit all necessary signatures on election and enrollment forms by this deadline.
 
The DCP provides producers an income safety net in the form of annual direct payments. Also, counter-cyclical payments can be provided when commodity prices fall below certain price levels. Some of the delay in this year’s sign-up might have been the fact that there will be no advanced direct payment for the 2012 crop year. Entire direct payments will be issued after October 1st, 2012 and will reflect on 85% of your farms’ base acres.

The ACRE program provides eligible producers a state-level revenue guarantee, based on the 5-year state Olympic average yield and the 2-year national average price. ACRE payments are made when both state and farm-level triggers are met.

By participating in ACRE, producers elect to forgo counter-cyclical payments, receive a 20-percent reduction in direct payments and a 30-percent reduction in loan rates. The decision to elect ACRE binds the farm to the program through the 2012 crop year.

The projected 2012 ACRE state trigger revenue for Iowa is $709.50 per acre. It might be difficult to trigger the ACRE payment in Iowa for the 2012 crop. Considering an Iowa average corn yield of 171 bushels per acre, the national average cash price for corn in the 2012-13 marketing year would need to fall below $4.15 per bushel.

If you have specific questions or need details regarding USDA farm programs including DCP or ACRE, contact your local USDA FSA office. You can also get news and information about USDA programs at www.fsa.usda.gov

Ag Decision Maker (AgDM)

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Farm Bill

2012 Crop Estimates Are Out

May 10th, 2012

Chad Hart , ISU Extension Grain Marketing Specialist, provides a summary of the May 10th report from USDA.

The USDA projects that the 2012 corn and soybean crops will be significantly bigger than the 2011 crops.  But let’s start with the 2011 demand numbers.  For corn, old crop feed demand was lowered 50 million bushels, based on alternative feed availability.  That change put 2011/12 ending stocks at 851 million bushels, nearly 100 million bushels above trade expectations.  USDA also lowered the 2011/12 season-average price midpoint by 10 cents to $6.10 per bushel.  For soybeans, crush gained 15 million bushels and exports gained 25 million.  These changes put 2011/12 ending stocks at 210 million bushels, 11 million below trade expectations.  USDA estimates the 2011/12 season-average price for soybeans at $12.35 per bushel.

 

For the new crop, this report sticks with the planted acreage from the March Prospective Plantings report, but the yield for corn been adjusted by 2 bushels to reflect the rapid planting thus far.  Corn production is projected at 14.79 billion bushels, another record crop projection.  Feed, residual, and export demand are all expected to increase for the new crop.  So we are looking at record demand as well.  But the surge in supply is greater than the increase in demand and ending stocks are projected to increase by over 1 billion bushels.  With higher stocks come lower prices and the midpoint of USDA’s 2012/13 season-average price range for corn is $4.60 per bushel, 40 cents lower than the unofficial estimates in February and $1.50 lower than the 2011/12 price.

 

While the corn market is staring at the potential for larger stocks, the soybean market is tightening back up again.  Production is projected at 3.2 billion bushels, but overall demand is projected at nearly 3.3 billion bushels.  Domestic and international demand are both expected to increase for the new crop.  That brings 2012/13 ending stock estimates down to 145 million bushels, the tightest we have seen since 2008.  The midpoint of the 2012/13 season-average price range is $13 per bushel.  So soybeans are on pace to set another record as well as this would be the 3rd year in a row to set a record high price.

 

Ag Decision Maker (AgDM)

An agricultural economics and business web site.

Crop Outlook