NAM_02-23-2015

AG Mag 1Spring 2014

AG MagCentral Iowa

High StakesThe new farm bill provides two new

options for revenue safety nets. Which is better for you?

P.O. Box 967Newton, IA 50208CHANGE SERVICE

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BULL MARKET: Cattle farming surges as meat prices climb

GREAT DEBATE: Have corn yields reached a plateau?

RURAL LIFE: Wind projects and their impacts on farmland

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AG Mag 3

Articles and advertisements are the property of News Publishing Co. No portion of the Central Iowa Ag Mag may be reproduced without the written consent of the publisher. Ad content is not the responsibility of News Publishing Co. The information in this magazine is believed to be accurate; however, News Publishing Co. cannot and does not guarantee its accuracy. News Publishing Co. cannot and will not be held liable for the quality or performance of goods and services provided by advertisers listed in any portion of this magazine.

PublisherDan Goetz

Advertising Director Jeff Holschuh

Managing EditorAbigail Pelzer

Magazine EditorsLarry Lough, Jeff Rogers

Page DesignJeff Rogers

Reporters & PhotographersJason W. Brooks, Sarah Brown,

Pam Eggemeier, Dave Fox, Kate Malott, Matt Mencarini,

Mike Mendenhall, and Jamee A. Pierson

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AG Central IowaMag

18COVER STORY

Decision to make Central Iowa farmers are weighing their options

for revenue safety nets in the 2014 farm bill.

Beefing upSlowly but surely, the

cattle industry is growing after drought years early in the decade.

Index

6

4 Spring 2015

Index

The great GMO debate

Is there a need to label foods made with

genetically modified ingredients as such?

Putting brakes on corn yields?Increases in corn prices have come to a halt in recent years. Some wonder whether the same is soon to happen to yields.

A sweets sister actSisters Amy Barton and Elaine Keuning turned a hobby into being All About Pies in Monroe.

Fundraising phenoms

The Newton High School Future Farmers of America

have proved to be prodigious at raising money.

Growing pains on the farmsWind power projects have farmers concerned about the viability of their farmland after construction.

Experience that mattersStudents in the FFA program at Prairie City-Monroe High School do work that they can apply in the real world.

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AG Mag 5

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LIVESTOCK PROSPERS WITH

HIGH PRICES Iowa producers see slow but steady growth after drought

BY MIKE MENDENHALL AND MATT MENCARINIFor Central Iowa Ag Mag

I n a large morton building on Morrissey Farms in Valeria, owner Mell Morrissey is reminded daily that cattle is in his DNA.

An old black-and-white photo from 1969, print-ed on canvas, hangs on the steel wall. It depicts the farmer as a 5-year-old boy holding a cow with his two brothers and father at the Chicago Stock Yards.

Morrissey runs a 75-head cattle operation in the small, incorporated town near the Polk/Jasper County border. He said the past two seasons he’s been rebuilding from the 2011-12 drought. In 2014, he sold a portion of his larger steer, but held back some of the smaller steer and heifers planning for the future.

The recent boom in meat prices has allowed established Central Iowa operations, including Morrissey Farms, to invest in heavy equipment that will benefit the local farm economies.

Q�Q�QThe Valeria farmer said when grain prices were high early in

the decade, many pastures were forced to overproduce hay to compensate. During the 2011-12 drought, Iowa farmers had to buy grain at higher prices when pastures could not grow – squeezing bottom lines. Those extremes, coupled with high livestock prices, have made it difficult for new start-up opera-tions to get off the ground.

The percentage of Iowa’s farm economy taken by cattle and hog operations has been declining in the past decade, with $10.8 billion in revenue in 2012 versus $19.4 billion in corn and soybeans. Morrissey attributes that to producers exit-ing the industry as livestock is more labor intensive than row crops, but the Jasper County producer said for the established livestock farmers – who have self-sustaining herds and invest-ment capital – 2014 was a lucrative year.

Mell Morrissey herds cattle at his 75-head operation in Valeria, Iowa. The livestock pro-ducer’s operation has begun slow growth as

high prices allow cattle to become his primary source of farm income.

( Photo submitted to Central Iowa Ag Mag )

CONTINUED ON 7�

AG Mag 7

“I would say prices haven’t affected me too much because we already had a cow herd base started,” he said. “The folk that current prices are hurting are the ones who are selling out, and someone else is trying to take over that pasture and buy cattle. Up-starts are terrible. I feel sorry for anyone who’s young trying to get into cattle. I don’t think they can do it.

“But I think the whole meat industry is going to be positive. The cattle can’t rebuild as fast as the hogs, turkeys and chickens, but I think it’s going to be a good and bright future.”

That future is in the hands of young producers like 20-year-old Robbie Guth-rie. The young farmer from Newton observed what many producers did after the drought – the hog industry has been much faster to rebound than cattle.

Guthrie is the fifth generation of his family to raise hogs, entering the indus-try through 4-H while in sixth grade. He saw an average of $200 per hog in 2014, with feeder pigs averaging $85 per head.

At the Mingo Meat Locker in western Jasper County, workers have processed beef, pork and lamb for individuals and the Des Moines Farmers Market for 33 years under current ownership. Man-

ager Alex Frangopol has witnessed a new trend in Iowa’s meat industry, with families bypassing counter prices alto-gether to raise their own animals. Fran-gopol said that gives consumers peace of mind knowing how the animals were raised, fed and treated.

“People want to know where their meat comes from,” he said.

Ultimately, Guthrie sees the American consumer dictating the fate of both cattle and hogs, buying what’s the most cost-effective at the meat counter.

Record profits reportedCurrent economic conditions for the

cow-calf industry in the Midwest could be chalked up to simple supply and demand, or perhaps the cyclical nature of all commodities, or even the perfect storm of conditions that started in 2011.

Or maybe all three.But the end result is the same: Historic

profits.In 2013, the average hundredweight

price for cattle in the U.S. was $126.83, up from $97.18 in 2010. But the highest month in 2013 – $132 – was dwarfed by the prices once the calender turned over into 2014.

By March 2014, the average hundred-weight price for cattle in the U.S. was

$150. It kept climbing, reaching $159 in August and $169 in November.

W. Travis Meteer. beef extension educator with the University of Illi-nois at Urbana-Champaign, said the cow-calf business is tradition-ally a break-even business. But that changed last year.

“We’ve seen it increase dramatically,” he said. “It depends on what econo-mist you use, but profits have been as high as $700 a cow. That’s a huge, huge increase from what cow-calf producers are used to seeing.”

Among those who have benefited is Dan Hanrahan, 38, current president of the Madison County Cattlemen Association.

“It is really remarkable the prices we are seeing,” said Hanrahan, who farms about 120 head of cattle with his par-ents near Cumming, Iowa. “This year has really been a bright spot for us.”

Cattle sell-offThe cattle charge all started with a

drought-stricken southern U.S. in 2011.Once cattle producers in the South

lose water, they can’t maintain animals, Meteer said. They can bring in hay, but water is the issue, so a huge liquidation of cow herd occurred in 2011 in the Southwest, he said.

The drought returned in 2012, again during the grazing season, but this time it affected a larger portion of the coun-try, including much of the Midwest.

��CONTINUED FROM 6

Photos by Mike Mendenhall/Central Iowa Ag MagBred cows on Morrissey Farms graze in a pasture near Valeria, Iowa. High beef prices have been good for established Iowa producers but have created difficul-ties for young farmers trying to enter the industry.

’’‘‘ We’ve seen [the cow-calf business] increase dramatically. It depends on what economist

you use, but profits have been as high as $700 a cow. That’s a huge, huge increase from what

cow-calf producers are used to seeing.W. Travis Meeter, beef extension educator

Meat from lamb and venison hangs in Mingo Locker during the closing weeks of Iowa’s deer-hunting season. Locker Manager Alex Frangopol said it is a growing trend for families to raise their own meat as counter prices rise.

CONTINUED ON 8�

8 Spring 2015

When cattle operations don’t have water, cows get sold, Meteer said, and the industry went through two years of mas-sive liquidation.

That’s where the simple law of supply and demand comes into play, said Phil Reemtsma, who is presi-dent of the Iowa Cattle-men’s Association. And that was helped, he said, by some misfortune in the pork industry with the spread of the porcine epi-

demic diarrhea virus, or PEDV, which killed off much of the pig supply.

“We had sort of perfect storm there of a shortage of animal protein,” said Reemtsma, a veterinarian from Dewitt.

That perfect storm resulted to record beef profits. And what cattlemen are doing with those profits can set them up for future success.

Some operators are building new facili-ties. In Iowa, many are building indoor facilities that will not only reduce costs, but reduce the chance of run-off making its way into rivers or streams.

“From a big picture standpoint, it’s great time to be in the cattle business,” Reemtsma said “There is going to be some up and down. But people investing in those operations, … I think it’s going to

be a good investment long term.”Others, like Dan Dykstra, vice president

of Whiteside County Cattlemen’s Associ-ation, who also has 50 head of cattle, will keep back more heifers than he usually would on his farm about 5 miles north-west of Morrison in northern Illinois.

While a heifer usually pays for itself in about 7 years, Dykstra said, he thinks he will cut that time in half with the animals he’s keeping.

Cattlemen looking to reinvest their profits from 2014 should consider all their options and evaluate whether they’re already maxed out, in which case the reinvestment might be best used to secure wealth against future loses or to make small changes to improve efficiency.

While starting up livestock operations on a farm that doesn’t already have them might be too expensive to take advantage of the current conditions, Meteer said, diversified farms with livestock and row crops may have an advantage over straight row crops.

“It just needs to be approached with common sense and awareness,” he said. “It is a little bit of an unforgiving business.”

Cyclical businessLee Schulz, assistant professor of eco-

nomics at Iowa State University who specializes in livestock, said production agriculture, and livestock in general, is

notoriously cyclical. There was already a tight sup-ply in the cattle industry before the liquidation hap-pened, he explained, and that’s what triggered the high prices.

“If we look at the mar-kets, the fundamentals of

both supply and demand are really sup-porting record profits in the livestock industry,” he said.

And 2015, Schulz said, looks like it could be on par with 2014.

But just as the weather in other parts of the country contributed to the rise in prices for cattle in the Midwest, it can also contribute to its fall.

“I just talked to a fellow in South Dakota,” Illinois cattleman Dykstra said. “They’re tickled to death with how things look this winter. If they have a normal year, a normal couple years, I say 2 to 3 years [of more high prices].

“If they experience another drought, it’ll extend it even more.”

What might seem like uncertainty to some, Illinois extension educator Meteer said, is just another year in the cow-cattle business.

“If you ever want a humbling experi-ence in life, own cattle,” he said. “There are a lot of factors that can come into play.”


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AG Mag 9

BY KATE MALOTTFor Central Iowa Ag Mag

With the right amount of talent and a dash of enthusiasm, Elaine Keuning and Amy Bar-ton, two sisters from rural Monroe and New-ton, have turned their well-known hobby into a well-known business – All About Pies.

The two sisters, formerly Lewises, grew up on their family farm north of Monroe with their parents and three brothers. There they learned how to cook and bake for a family, family values that have been put into use and carried on as they both married, had children and are now grandparents.

Hobby makes just

desserts Jasper County sisters

are All About Pies

CONTINUED ON 10�

Sisters Amy Barton (left) and Elaine Keuning started making pies as a hobby, mostly for their families. As their pies became more well

known, they started All About Pies, based in Monroe, in 1995. (Photo submitted to Central Iowa Ag Mag)

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Amy married Earl Barton and they have two boys with grandchildren. Amy is a Maytag Dairy Farm employee in Newton.

Elaine married Don Keuning and they have two boys, a girl and grandchildren. Elaine is a Mid Iowa Painting employee in Runnells.

The two have been in the pie business since 1995, Keuning said.

Their families, primarily sons, pre-fer pie rather than cake, so Keuning and Barton would make pies for their boys’ birthdays or graduations, which became well-known, liked and request-ed at future events. What started as a hobby between two sisters then turned into selling pies at their sweet corn stand or making special orders, and has further turned into a business with three locations.

As the business grew, Keuning said, she and Barton still had fun baking.

“The main thing I enjoy is getting together with my sister and my friend-ship with her, and also just all our cus-tomers from all over,” Keuning said. “We’ve made a lot of good friendships with people from all over.”

Knoxville Nationals was a location where they started selling and gaining repeat customers each year. Area vis-its by RAGBRAI are big hits, as well as

Monroe Bike Nights, and Maytag Dairy Farm has featured their pies at various events.

“Those are a lot of fun to do, and

we’ve been very lucky for those for the opportunities,” Keuning said.


Kate Malott/Central Iowa Ag Mag Donna Baarda (left) and her daughter, Darla, both of Newton, enjoy the selection as they sampled All About Pie’s apple pie at the Maytag Dairy Farms Harvest Party in October.

CONTINUED ON 11�

Look for our next edition of

AGMagCentral Iowa

July 2015Featuring additional coverage in

Jasper, Poweshiek, Marshall, Tama, Benton, Marion, Mahaska, Iowa &

Keokuk Counties.

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AG Mag 11

All About Pies was recently featured on Iowa Public Tele-vision’s Iowa Ingredients and highlighted the sisters’ cran-raspberry pie, which has turned into a unique favorite for many loyal and new customers, espe-cially near the holidays.

Triple berry is one of the most popular, but the apple is the favorite.

“Apple is always our best seller,” Keuning said. “I don’t know what it is, but it’s a safe pie selection. Nobody’s scared of apple.”

Besides apple, black raspber-ry, triple berry and cran-rasp-berry, Keuning and Barton also make blackberry, blueberry, cherry, gooseberry, mincemeat, peach, red raspberry, rhubarb and strawberry.

All About Pies can be found in three locations in Jasper and Marion County: The Pie Kitch-en in Monroe, PJ’s Deli in New-ton, and Main Street Market in Knoxville.

To order a pie, stop in one of the three locations, call 641-891-9068, or visit allaboutpies.net for more information.


’’‘‘ The main thing I enjoy is getting together with my sister and my friendship with her, and also just all our customers from all over. We’ve made a lot of good friendships with people from all over.

Elaine Keuning, co-owner of All About Pies

Photo submitted to Central Iowa Ag MagAll About Pies’ made-from-scratch frozen fruit pies include apple, black raspberry, triple berry, and cran-raspberry. Elaine Keuning and Amy Barton, sisters who operate the busi-ness, also make blackberry, blueberry, cherry, gooseberry, mincemeat, peach, red rasp-berry, rhubarb and strawberry pies.

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BY JASON W. BROOKSFor Central Iowa Ag Mag

The Newton High School Future Farmers of America chapter sold more than $46,000 in its annual fall and first-semester fruit sales fun-draiser.

The amount is an all-time high for Newton FFA, chap-ter Secretary Macy Leonard said. The amount also cov-ered sales of meats, cheese, candy and popcorn.

The top three sellers for the chapter were Dylon Mor-rison, Macy Leonard and Logan Zaabel.

“Fruit sales prepare the students for future careers in agricultural sales and also allows members to partici-pate in numerous FFA activ-ities throughout the year,”

Leonard said.The Newton FFA thanked

everyone who donated money or bought fruit and other items to support the chapter, she added.

The Newton program includes more than 120 students who are studying agricultural education. In Sep-tember, Newton FFA placed

eighth out of 24 teams and received a silver ranking at the South Central District FFA Soil Judging Career Development Event, held at a Knoxville farm.

The Agriculture Science III class competed with four members. Austin James, Mathew Bleakney, Benton Vest and Jacob Smith were required to judge the soil

from four pits and take a 40-question test.

Newton High School is offering six agricultural courses in 2014-15 – Agricul-ture Science I, II, III and IV, as well as Horticulture and Agricultural Sales & Mar-keting. FFA is offered as an extracurricular program at NHS, while Supervised Agri-cultural Experience is classi-fied as “intra-curricular.”

Newton FFA hosted a chapter visit and attended the Iowa FFA Legislative Symposium in January. The chapter receives outstanding community support from farm families, civic organiza-tions and area businesses.

The Newton office of Under-writers Laboratories combined with LG electronics company for one donation. The two companies recently donated a 42-inch LG television to the Newton FFA Chapter for use in the school’s agriculture classroom.

FFA fundraising fabulous Newton chapter cleared $46,000 in 2014 fruit sales

Photo submitted to Central Iowa Ag Mag A Newton High School Future Farmers of America team placed eighth among 24 squads and received a silver rank-ing at a September 2014 competition. The school has about 120 students active in FFA.

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AG Mag 13

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14 Spring 2015

BY JASON W. BROOKSAND DAVE FOX

For Central Iowa Ag Mag

Sometimes, the only certainty in farming is uncertainty.

Take corn, for instance.Both yields and prices in corn markets have

seen record highs in recent years. Yields con-tinue to fluctuate, ever upward, while prices seem to have corrected themselves – down-ward – after the golden grain hit an all-time high in recent years.

For decades, farmers have seen yields rise, doubling since 1975 to record-breaking levels for many growers in 2014.

“There’s a big debate within agriculture nationally: Do we have continued room for growth in yields?” said Chad Hart, a profes-sor and crop market specialist from Iowa State University. “You look at state-level numbers, you see well over 200. Some-where in the 200s is where I think we can plateau.”

Mark Johnson, an Iowa State University field agronomist, said a plateau could create a major problem, since Iowa is such a large producer in the heavy corn-exporting U.S.

“A plateau is highly unlikely,” Johnson said. “And if we had one, we wouldn’t be able to feed the world.”

Uneven trendIowa produced 181.81 bushels of corn per acre in

2014, Johnson said – much higher than the national average. He said ethanol production accounts for about one-third of that total. He said that while yields have not increased or decreased by the same amount in any two consecutive years, the trend has still climbed, in general, for more than 30 years.

A CAP ON CORN?

AG Mag 15

Farmers have mixed

ideas on yield potential

“There are no two years that follow the trend line,” Johnson said. “But we now have about 14 million acres of field corn in this state. There’s still a trend line.”

Mark Hendrickson, of Grinnell, said he’ll grow slightly less field corn than last year, but that’s by design and rotation, not because of cur-rent market factors. He said he thinks the amount of Iowa corn yield will plateau soon.

“I think it will level off,” he said. “It’s hit a point where if it does continue to go up, it’s not going to go up very fast.”

Hendrickson said his son, Ryan, pays more attention to markets, numbers and regional economic factors. Ryan Hen-drickson said Mother Nature might have more to say about corn yields than any man-made influences.

“A lot always depends on the weath-er,” Ryan said. “Consistency helps. I haven’t looked at an almanac for next summer yet, but I read a few months ago it could be a cold winter, and sometimes, colder is better.”

Doug Bell, a longtime Iowa farmer whose son, David, is the manager of the Key Co-Op’s Le Grand location, said he won’t plant as much corn as he did in 2014, but that has been his 2015 plan for some time.

“Prices influence things a little,” Bell said. “But there’s a lot else to consider besides that, such as how to get the best use out of the most hilly land in an acreage.”

CONTINUED ON 16�

Dave Fox/Central Iowa Ag MagCorn is moved from one step to the next in the seed corn processing plant at Prai-rie Hybrids in Deer Grove, Illinois. In Iowa, farmers produced 181.81 bushels of corn per acre in 2014, much higher than the national average.

Jason W. Brooks/Central Iowa Ag Mag

In a few months, these grain silos in Sully, Iowa, will be at the center of a busy corn and soybean farming community. Iowa experts are not all of the same mind when it comes to predicting whether corn yields will pla-teau or continue to rise in 2015.

Mark Johnson Iowa State

University field agronomist says

corn yields in Iowa have been on the rise for more than 30

years.

16 Spring 2015

Bell said he read a recent magazine article that said the potential top-out point is 500 bushels of corn per acre, under “greenhouse-perfect condi-tions.” He doesn’t think it will get there in real life – certainly not any time soon – but that type of optimism makes him realize a lot of people want to keep numbers rising.

“Apparently, there’s still a lot of room for growth,” Bell said. “With even a little bit of fair weather, the yields should still at least inch higher.”

Market correctionBut after record yields and high prices,

the market has worked to correct itself.There is somewhat of a downward

trend on the number of corn acres being planted, according to USDA’s World Agricultural Supply and Demand Estimates report, which was released in January.

According to that report, an estimated 97.3 million acres of corn were planted in the U.S. in 2012-13, with that num-ber dropping to 95.4 million acres the next season. The agency estimates a drastically lower 90.6 million acres of corn being planted in the U.S. in the coming growing season amid corn pric-es at half of what they were less than

three years ago.Iowa State agronomist Johnson said

weather and long-range forecasts make an impact on planting choices.

“A lot hinges on weather during the growing season,” he said. “Farmers only have about a three-week win-dow in June, or close to it, when the

real meaningful plant growth hap-pens,”

Moisture levels also make a huge dif-ference, Johnson said.

“If it goes real hot or real wet, the crop and the yield are affected,” he said.


Jason W. Brooks/Central Iowa Ag Mag Field corn seed sits in a warehouse at Key Co-op in Sully, Iowa, waiting to be deployed to Central Iowa fields in the spring. Some farmers and experts say Iowa’s corn yield must continue to rise in order to help meet the world food demand.

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AG Mag 17

“Corn needs oxygen to grow and flourish, and in stand-ing water, there isn’t enough oxygen. And if it gets real hot for a few weeks in a row or more, the plant dries out.”

Gilbert Hostetler, president of Deer Grove, Illinois-based Prairie Hybrids, said actual yield per acre would largely depend on the type of seed planted.

“GMO [genetically modi-fied seed] tends to produce slightly lower yields per acre than non-GMO,” he said.

“Non-GMO corn generally produces about 15 bushels more per acre than GMO varieties,” he said. “Some of our non-GMO seed averages 200 to 225 bushels per acre, and we have had some go as high as 300.”

But while GMO corn might not keep up with non-GMO in yields, it does lend itself to other advantages.

“There tend to be less insects and other things,” said Dan Koster, president of Tettens Grain based in Galt, Illinois, “because GMO corn has traits built in that make it insect and fungus-resistant.

Abundance of cornPioneer Seed’s Steven Long,

based in Sterling Illinois, said there will likely be more beans and less corn planted this coming season, at least in the Midwest, as a step toward correcting the market.

“It’s a little more economi-cal to put out beans,” he said. “It’s a crop that costs less to produce than corn.”

Once existing supplies shrink, prices could rise

again and more corn could be planted. But not this year, in all likelihood.

“As there’s an abundant supply of corn, and less demand, the price will always go down,” he said. “Low prices cure low prices.”

Hostetler, with Prairie Hybrids, agrees there will likely be less corn acres this season.

“There will be definitely less corn in 2015,” he said. “Farmers are scared stiff they’ll be making a lot less money. The market is cor-recting itself.”

Kevin Veneesta, whose farm lies between Grinnell and Lynnville, said yield fluctua-tions and corn prices he’s seen in recent years haven’t been enough to change any of his seeding decisions.

“It would take a lot more of a price drop to make me want to plant any less corn,” Veneesta said. “And it would take a pret-ty significant [price[ increase

to make me plant any more than I am now.”

Veneesta said changing farming practices to hook a bigger profit margin isn’t part of the approach he takes to planting.

“I wouldn’t change just to try and make more money,” he said. “I would mostly change only if I had to, to keep from losing what I’m

getting now.”Iowa State’s Johnson said

ethanol is not having an impact yet on how much field corn farmers decide to plant, as their product can still be sold as food – just not neces-sarily for as much money.

He said he could not imag-ine ethanol becoming so lucrative that farmers would want to stop producing corn for food – even though ethanol already accounts for one-third of field corn yields. It’s not a matter of how many farmers are in the corn busi-ness or which ones produced corn for what purpose – it’s more a matter of planting less if the price is low.

Technology also some-times plays a part in yields and planning, Johnston said.

“A few years ago, no one was talking about drilling into shale [fracking], and getting tons of oil out of it,” Johnson said. “But look what’s happening in North Dakota now. No one really knows when a phenomenon like ethanol or shale oil is going to come along – even in the corn business.”


Jason W. Brooks/Central Iowa Ag Mag Propane sits ready at Key Co-op in Sully, Iowa. Retail prices for propane, gasoline and ethanol affect field corn prices, but Central Iowa farmers said prices are not the main factor in deciding how much corn to plant this year.

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18 Spring 2015

BY PAM EGGEMEIERAND JAMEE A. PIERSONFor Central Iowa Ag Mag

Direct payments disappeared in the new farm bill, and farmers have until March 31 to choose between two new safety net programs.

One of the programs modifies the previous farm bill’s target price program. The Agricul-tural Act of 2014 replaced the Counter-Cyclical Payment program with the Price Loss Coverage program.

The other option, with two variations, changes the revenue safety nets. Agricultural Risk Cov-erage replaces Average Crop Revenue Election with ARC County and ARC Individual Farm. Those who don’t make a decision will automati-cally be enrolled in PLC; they will be paid for 2015, but not 2014 because CCP payments were based on the previous marketing year averages.

Wait and learnFarmers still assessing

safety net options provided in farm bill

Photo submitted to Central Iowa Ag MagDrew Weyers works in the field of his farm south of Monroe. Weyers said he is leaning toward going with Agricultural Risk Coverage as his revenue safety net but wants to learn more about his options before making a final decision.

Michael Krabbenhoeft/Central Iowa Ag MagFarmers look through information about the 2014 Farm Bill during a meeting in January at the Carroll County Farm Bureau in northwest Illi-nois. Farmers in Iowa, like those in Illinois and nationwide, have until March 31 to decide which revenue safety net they wish to use.CONTINUED ON 19�

AG Mag 19

But before farmers make that choice, there is a more pressing information-gathering deadline coming. Farmers have until Feb. 27 to update their base acreage reallocation and yield history information.

Jerry Quinton, executive director for the Lee County Farm Service Agency in northern Illinois, said farm-ers and landowners need to take care of the revisions before choosing a safety net option. FSA needs the yield data as bushels per acre between 2008 and 2012.

“We take 90 percent of that and it becomes the new yield,” Quinton said. “That can then be used for the new PLC program.”

Even if they choose ARC County, FSA still needs producers to certify their yields. To reallocate the base acres on a farm, FSA will use the average of the reported acreage from 2009 through 2012.

“I would urge farmers to take advantage of the yield and reallocation opportuni-ties because it’s the first time they could do it since 2002-2003,” Quinton said.

If no action is taken before the deadline, the current base and yield will be used. Given the delay in craft-ing a new farm bill, the FSA offices are under the gun with the deadlines. Quinton said farmers should make an appointment with his office as soon as possible.

“We didn’t get the green light to start this until after October 1,” Quinton said. “Given the current situa-tion, we’d need to average 46 farms a day now to finish on time.”

Several educational meet-ings were held in November and December. While ARC County seems to be the popular choice in northern Illinois, many farmers are still weighing the risk in their decisions.

Some farm organizations in northern Illinois are pointing producers in the direction of the ARC County safety net option because they believe it favors Mid-

west grain producers. It uses a collective benchmark yield, for example, $1.70 for Lee County.

An important difference between ARC and PLC is that ARC is a revenue program. PLC uses target and loan prices with a $1.75 spread. It covers only loss and doesn’t protect revenue.

ARC Individual doesn’t receive much attention in Illinois because it is believed to be a better choice for farmers who have smaller farms where climate, soil types, and yield can vary greatly throughout a county.

The only part of the safety net process that crop insur-ers are directly dealing with is the Supplemental Crop Option, which is available only as an add-on with PLC.

“Right now I am leaning toward ARC,” Drew Weyers said, “but I am going to go to another meeting to make sure.”

Weyers, who has farmed for seven years south of Monroe, mainly in Marion County, runs a cow-and-calf opera-tion and does a crop rotation of corn and soybeans.

“[ARC] looks to work better for my operation,” Weyers said. “In the current corn trading prices, ARC looks better because of the prices, but there are pros and cons to each program for all situ-ations.”

With a local meeting set by FSA approaching, he wanted to wait and get as much information as possible before deciding.

Dirk Van Wyk, like many other farmers, is also waiting to make a decision.

“I plan on visiting the FSA office and learning more,” Van Wyk said.

The PLC option would seem to be better suited for farm-ers in the southern states, where crops like cotton and rice are king. Because PLC offers a deeper net, it might also be a better choice for new farmers who are just get-ting established.

It’s important to note that neither program is intended to replace crop insurance.


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Gary Schnitkey, an agriculture economist at the University of Illinois, breaks down the decision process into three parts: Which has the highest expected payments; how concerned you are about low prices; and what is the availability of the supplemental coverage?

“ARC County probably has the highest expected payments for corn,” Schnitkey said. “This is best if you believe prices will be above $3.30 over 5 years, but you’d better be in PLC if you’re con-cerned corn will come in below $3.30.”

Current corn prices have been in the $4 range.

Schnitkey said the availability of SCO isn’t likely to be a big factor because it adds only about 1 percent to the mix.

In Iowa, Dave Miller is a go-to guy on the safety net options. He is the direc-tor of research for commodity services at Iowa Farm Bureau. Because of the complexity of the programs, even an expert like Miller has changed his mind on some of the finer points.

“A few months ago, I said ARC County is probably best for most people in Iowa, but now I believe PLC competes pretty well in southern Iowa,” Miller said.

Miller believes efforts to educate farmers are starting to cut through the initial confusion. The hesitancy has backed up the process, adding to dead-line stress at the FSA offices.

“We had very good attendance at our state meetings,” Miller said, “and many people had gone to several meetings before they said they were finally get-ting it because it’s complex and dif-ficult.”

Miller still believes ARC County is best for soybeans in Illinois and Iowa, based on his calculations showing there is only about a 5 percent to 10 percent chance of getting PLC pay-ments for soybeans in any of the 5 years.

For corn, the decision is not so simple. Farmers are urged to remember that the safety net options will cover 5 crop years – a period from 2014 through 2018.

ARC County is likely to provide a big-

ger payout in the first 2 years, but not much protection on the back end of the contract.

With PLC, if corn hangs around $4.25, farmers might get only one payment, but it would provide much deeper pro-tection if prices were to drop off the table into the $3 range. PLC also seems to be a better choice in areas where yields are steadier.

Miller said much of the decision should be about assessing debt load and risk tolerance.

“If $3 corn could put you out of busi-ness, you should look at PLC,” he advised, “but others should get the max now with less protection in the back end. It’s kind of like sitting down at a poker game, and with ARC, you’re assured of winning your first two hands.”

Some global issues at play are cause for concern when betting on corn pric-es. Weather is always the biggest wild

card, and farmers have been blessed with a longer up cycle with prices than usual in such a cyclical business. Another record production year in 2014, nationally and in Illinois, could stoke worries about oversupply.

“It’s not a big concern at the moment – we went from $3 corn in August to near $4 now – but if we have another good year in 2015, it could get back to $3 in a hurry,” Schnitkey said.

Ethanol is another piece of the supply puzzle. Plunging oil prices and a trend toward reduced gas consumption pres-ent a potentially dangerous mix for the ethanol industry.

“Oil’s effect on the markets will defi-nitely be something to watch moving forward,” Miller said. “It could put a great deal of pressure on the ethanol industry.”

Larry Hummel, a Lee County, Illinois, farmer and Farm Bureau crop watcher, said farmers are concerned about the effect of low gas prices on alternative fuels.

“It doesn’t seem to be having too much of an impact here yet, but it’s a big question mark right now,” Hummel said. “The uncertainty about revising fuel standards makes it an even bigger concern.”

Ethanol producers use about 10 per-cent of the corn produced nationally, with a similar mix reported in Illinois.


’’‘‘ [ARC] looks to work better for my operation. In the current corn trading prices, ARC looks better because of the prices, but there are pros and cons to each program

for all situations.Drew Weyers (pictured above), who farms south of Monroe

’’‘‘ If $3 corn could put you out of business, you should look at PLC, but others should get the max now with less protection in the back end. It’s kind of like sitting down at a poker game, and with ARC, you’re assured of winning your

first two hands.David Miller, Iowa State University

AG Mag 21

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Cole Vander Linden“I pretty much get it from the local news websites

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22 Spring 2015

BY MIKE MENDENHALLFor Central Iowa Ag Mag

Before construction begins on the 500-mile, 3,500-megawatt direct cur-rent transmission system of Rock Island Clean Line, project developers would like to win over land owners like Greg Gillespie.

The O’Brien County resident filed a letter of objection to the project in March 2013, concerned about the via-bility of his farmland after construction.

“They’re going buy the area at current land value, but we feel that that value is pretty low,” Gillespie said.

Texas-based Clean Line Energy Part-ners – the company spearheading the project – has asked to utilize 75 feet of property on Gillespie’s land. The com-

pany wants to negotiate easements with landowners in the 16 northern Iowa counties affected, but there is some resistance. Gillespie has joined the group Preservation of Rural Iowa, a nonprofit organization formed to assist landowners who oppose the 375-mile Iowa stretch of the transmission line.

Illinois has already approved 125 miles of transmission lines for the project, but withheld eminent domain authority. The line would carry wind-generated power from western Iowa to a substation in Grundy County, Illinois, for use in Chicago and east-ward..

LIVING ON THE LINE

Construction date of RICL Iowa segment still unclear; developers filing for franchise agreements

Photos by Mike Mendenhall/Central Iowa Ag MagThere are 67 turbines on the Laurel Wind Farm near Laurel, south of the border of Jasper and Marshall counties. Iowa is sec-ond only to Texas in production of wind-generated power. According to the Iowa Utilities Board, Iowa generated about 27 percent of its power from wind in 2013. The development of wind power projects like the Laurel Wind Farm and Rock Island Clean Line have farmers in their paths concerned about the viability of their farmland after construction.

Larry Wehrman, of Laurel, stands under a 263-foot-tall, 2.3-megawatt windmill on his acreage in Central Iowa. Developers are seeking approval from the Iowa Utilities Board for the Rock Island Clean Line project, which would transmit wind-generated energy produced on wind farms like the Laurel Wind Farm.CONTINUED ON 23�

AG Mag 23

Before construction on the wind energy transmission project can move forward, it will have to get approval from the Iowa Utilities Board – a three-member, nonpartisan panel appointed by Gov. Terry Branstad. The IUB is currently considering approval of a hazardous liquid pipeline proposed by Dakota Access Pipeline LLC, which is slated to bring North Dakota crude oil through Iowa to Patoka, Illinois. Rob Hillesland, information specialist for IUB, said this is the first time in recent memory that IUB has considered two such significant statewide projects simultaneously.

RICL completed the countywide informational meetings required by Iowa Code in 2013 and filed its permit to build in November of last year. Cur-rently, project developers are petition-ing for franchise agreements and hope to begin construction in 2016, taking five to seven years. Before the project

can reach approval, the IUB will hold a hearing in the county seat closest to the center of the transmission line. A date for the hearing and venue have not yet been decided by IUB.

According to figures from Hillesland, 1,704 letters of support for the RICL – and 1,105 letters of objection – have been filed with the regulatory agency. Most of the debate surrounding the project is with eminent domain. The current project route takes the RICL through 2,000 parcels of land. Gillespie is concerned that construction crews will compress topsoil, making his land untillable and unplantable for years – although RICL would be responsible for a land reclamation process as part of the easement.

Iowa is second only to Texas in pro-duction of wind generated power. According to the IUB, Iowa generated about 27 percent of its power from wind in 2013.

Larry Wehrman owns a 160-acre row crop operation in the center of the

Laurel Wind Farm, a 121-megawatt project producing for Mid-American Energy in Marshall County. As with the RICL project, Wehrman and other property owners within the 11,000-acre wind farm received easement offers from developers, but most felt the project was positive and did not have to fight an eminent domain claim. After developers approached the land owners, area land owners jointly hired a lawyer to represent all their interests at once.

After construction, Wehrman said he was pleased with the reclamation process and noted that any damage to his land was promptly repaired by Mid American. As far as the noise and skyscape, Wehrman said he couldn’t be happier.

“It’s like living next to train tracks after a while,” he said. “The only thing noticeable is you go outside at night and, if the weather is right, you can hear them. Just a little swish noise. But, heck, they don’t bother us a bit.”

Preferred route for Rock Island Clean Line transmission project


24 Spring 2015

BY SARAH BROWNFor Central Iowa Ag Mag

Bills that would require the labeling of genetically engineered foods have been introduced in the Iowa Legislature but never emerged from committee.

“I don’t think there is anything pending right now, but, that can always change,” said Ruth MacDonald, professor and chairperson in food science and human nutrition at Iowa State University.

Senate File 194 was introduced in the Iowa Senate in early 2013. That same year, House File 463 was introduced in the Iowa House of Representatives.

The Senate bill, authored by Sen. Joe

Bolkcom, would have required “con-sumer labeling information for food, providing penalties, and including effective date provisions.” The House version – sponsored by nine Iowa repre-sentatives – proposed “food items to be labeled with information that identifies the food items as genetically modified.”

Why GMO labeling has failedMandated labeling of genetically

modified organisms has failed at the state level for a number of reasons. While the U.S. does not have a federal law to mandate labeling of GMOs, vol-

untary labeling by states is permitted.“You might not be able to win an indi-

vidual state and do it [mandated GMO labeling],” MacDonald said, “but, if you get enough states to say ‘this is important to us’ and pass the laws, that would force the hand of the federal government.“

MacDonald said the FDA’s position on GMOs since the 1980s has been that the process of creating foods through genetic engineering does not change the nutritional or structural chemical composition of the food, therefore it does not need to be labeled.

Mandated GMO labeling bills in Iowa failed; debate continues

Sarah Brown/Central Iowa Ag MagIn response to consumer demand, General Mills announced its original Cheerios cereal is now made without the use of genetically modified ingredients. While there are no GMO oats, which is the primary ingredient in Cheerios, General Mills now uses only corn starch derived from non-GMO corn and non-GMO pure cane sugar.

Is GMO labeling worth it?

CONTINUED ON 25�

AG Mag 25

“Adding a label that a prod-uct is produced by geneti-cally modified technology does not change the safety or the quality of the food in any way,” MacDonald said. “It

would become an additional regulatory fac-tor for the food industry to manage for no benefit to the consumers.”

MacDonald said there is

no evidence that non-GMO products are better or safer than GMO products.

However, Howard Vlieger, an independent crop and livestock nutrition adviser, and a third-generation farm-er, disagreed.

“There are tremendous amounts of incidents of the ill effects that are being observed and documented by a growing number of pediatricians across the country,” Vlieger said. “I think it [GMO labeling] is a must for protecting the health of our future genera-tions.”

Vlieger, a self-described “student of the soil,” began using alterna-tive farming practices in 1989 to decrease the use of chemicals on his crops.

In 1992, Vlieger’s advisory work, which now spans 16 states, has helped farmers to decrease their dependency on chemicals and move to organic or biological farming practices.

In Vlieger’s advisory work, clients started to recognize a change in their animals as BT, or genetically engineered corn, was removed from their feed. Problems causing gastrointestinal tract infec-tions, ulcers, false pregnan-cies and bloody bowels went away.

Vlieger’s concern: if this is happening in animals, what is it doing to humans?

A long-term feeding study, co-authored by Vlieger, was published in 2013 in the

Journal of Organic Systems. Researchers found signifi-cantly higher rates of severe stomach inflammation and thickening of the uterus in pigs that were fed GMO corn and soy.

“It proposes a real health risk,” Vlieger said.

Current optionsA 2013 study on consumer

behavior, conducted by Harris Interactive on behalf of the Iowa Farm Bureau, concluded consumer deci-sions, when selecting meat and dairy products, were based on three primary fac-tors – price, taste and nutri-tion. Less than 20 percent of consumers were concerned with how the products were produced.

“If you are worried about some particular ingredient or have a logical reason of why you want to avoid that ingre-dient, that is your decision,” MacDonald said.

MacDonald said there is already a way to avoid GMOs without the rigma-role, regulatory processes, and mandates on the food industry that are already in place: Eat organic. Organic labeling is voluntary, but any producer who chooses to label products as organic are subject to strict verifi-able guidelines by the U.S. Food and Drug Administra-tion.

“Anything that is made in the United States out of corn or soybeans, and any of the ingredients that come from that, pretty much are going to be GMO,” MacDonald said. “So, if you don’t want to eat GMO stuff, don’t buy things that have those ingre-dients.”

However, some people avoid buying organic pro-duce because of its higher price. MacDonald said the cost of mandated GMO label-ing would be absorbed by the consumer.

Despite being against mandated GMO labeling, MacDonald said “consumer knowledge is a good thing,” but, is against a labeling pro-gram being adopted “just because” someone wants to know.


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BY MIKE MENDENHALLFor Central Iowa Ag Mag

The waning months of summer can get toasty in the PCM Diamond Trail FFA greenhouse.

In late September it was 91 degrees, and Mustang vocational agriculture instructor Nicole Gent knows heat rises. She climbed a ladder atop the glass-and-steel structure – power drill in her belt holster – to remove aging glass paneling.

“It’s to the point where it needs replaced,” she said. “[Students will] help me with it, but it’s going to be a lot of me after school to get it done.”

Coinciding with the hothouse updates, Gent pre-pared to add the final piece of metal to face the out-side of 12 welding booths. A new exhaust system was also recently installed. The 2014-15 school year is Gent’s second to lead the FFA class. The program has been part of the PCM curriculum since Feb. 28, 1947. Its 12 courses vary from agronomy to farm business management to welding and public speaking.

The program also provides students opportunities – such as the greenhouse, events testing parliamentary procedure, and soil-nutrient judging – to exercise skills they’ve gained in class with practical application.

Produce, pigs, productionHigh school FFA program strives

for real-world application

Photos by Mike Mendenhall/Central Iowa Ag MagABOVE: Prairie City-Monroe High School senior Aaron Hegwood and agricultural science teacher Nicole Gent remove glass paneling from the top of the Diamond Trail FFA greenhouse in Monroe, Iowa, last fall at the Monroe school. ON PAGE 27: Gavin Branderhorst, 12, of rural Prairie City, cleans his pig after a walk through the pasture at his home July 12. The 4-H member was getting his animal ready to show at last year’s Jasper County Fair.CONTINUED ON 27�

AG Mag 27

Wearing hard hats and safety gloves, FFA students moved the long, rubber, hon-eycomb-topped tables out of the hothouse below. Students helped with the repairs to ready the greenhouse for a farm business analysis. Farm business management stu-dents looked at expenses ver-sus the income and profit of their project from the 2013-14 growing season to forecast for the current school year.

After the greenhouse prep, the farm business class will create a flow sheet of green-house income vs. expenses. During the winter months, students will begin to grow vegetables, flowers and perennials, readying the goods for sale in April. Stu-dents will sell the produce and non-edibles straight from the greenhouse.

PCM Senior Connor Warrick is the school’s FFA president – currently taking ag business in the program. He does not plan to have a career in agri-culture, but does intend to take over his family’s farm in the future. Because he comes from a family that raises hogs, the class allows him to learn more of the technical side of the trade his father enjoys.

In his four years at PCM, the senior has been a part of the program’s livestock judging and horticulture teams and public speaking events. War-rick said the Diamond Trail FFA program adds a real-world value to his education.

“It has the value of getting a hands-on experience,” Warrick said. “Not many classes other than shop or welding give you

hands-on job experience.“We can take the stuff we

do in agronomy class and put that into our future profes-sions. We can take something like welding, or anything like that, and use it as a trade and actually have a job in it.”

In late September, six of PCM’s FFA students competed in the soils judging contest in Knoxville, Iowa. Teams from around the region competed in analyzing the different layers and horizons of soil makeup from pits dug in fields. The stu-dents looked through the soil makeup for the organic mat-ter necessary for viability. The Diamond Trail team came in 16th among 24 teams, a silver metal ranking.

“Once we came back, we went over each of the individ-ual results,” instructor Gent said. “We talked about those, what [judges] looked for, what they should have seen, things like that to help them improve.”

Gent felt the performance suffered from simple ner-vousness and inexperience. Many of the students had not participated in soils before the event. But since the Sep-tember contest, FFA has had multiple conventions and conferences, all of which is a draw for students interested in STEM fields, she added.

“I think there are a number of benefits for someone interested both in science and in ag,” she said. “Not only do they develop skill within the ag industry, but they can use it in any career that they choose to pursue. They can take the knowledge they gain in science or math and apply it to a contest or proj-ect they do within FFA.”


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