Start Of The Crop Insurance Price Determination Begins This Week


increase planted acres for that commodity. Last year’s projected crop in- surance price ratios, 2.385 soybeans/corn; 0.1825 cotton/corn; and 0.0765


cotton/soy-


termination period for spring planted crops in Tennessee. Unfortu- nately,


N futures prices


have retreated substan- tially compared to the beginning of the calen- dar year: December corn opened the month at $4.01 ¾ and closed at $3.91, down 10 ¾ cents; November


soybeans


opened January at $9.78 ¾ and closed at $9.12 ½, down 66 ¼ cents; and December cotton opened January at 70.7 and closed at 68.73, down 1.97 cents. The projected (spring)


crop insurance price in Tennessee is determined by the average daily closing price of the har- vest contract for the month of February. For 2019, the projected crop insurance price was: $4.00/bu for


corn,


$9.54/bu for soybeans, and $0.73/lb for cotton. The projected crop in- surance price is one fac- tor


that provides


producers with informa- tion on what should be planted. A higher price for one commodity, com- pare to the others, re- sults in a greater relative crop insurance revenue guarantee and should provide an incentive to


DR. AARON SMITH KNOXVILLE, TENN.


ext week will be the start of the crop in- surance price de-


beans, favored greater corn and cotton acreage in the state at the ex- pense of soybean acres. For all three commodi-


ties, the current harvest futures price is less than the 2019 final projected prices. However, based on where harvest futures are at the end of Janu- ary 2020 it appears corn stands to gain additional planted acres. Corn-to- soybean price ratio is 2.33 indicating an even greater bias towards in- creased corn acres com- pared to soybeans than 2019. Cotton-to-corn price ratio is 0.176 also favoring corn planting over cotton. Cotton-to- soybean price ratio is 0.0753 indicating a slight preference for soy- beans over cotton com- pared to 2019. A lot can happen in


one month (see the price changes above), however if the price relationships amongst


the three


spring crops hold, it is reasonable to assume that crop insurance guarantees will favor in- creased planted acres for corn over cotton and soy-beans in 2020. Corn Ethanol production for


the week ending Janu- ary 24 was 1.029 million barrels per day, down 20,000 barrels from the previous week. Ethanol stocks were 24.244 mil- lion barrels, up 0.213 million barrels compare to last week. Corn net sales reported by ex- porters for January 17-


23 were up compared to last week with net sales of 48.6 million bushels for the 2019/20 market- ing year and 5.7 million bushels for the 2020/21 marketing year. Exports for the same time period were up 74 percent from last week at 26.8 million bushels. Corn export sales and commitments were 48 percent of the USDA estimated total annual exports for the 2019/20 marketing year (September 1 to August 31) compared to the pre- vious 5-year average of 63 percent. Across Ten- nessee, average corn basis (cash price-nearby futures price) weakened at Memphis, Northwest Barge Points, and North- west Tennessee and strengthened at Upper- middle Tennessee. Over- all, basis for the week ranged from 18 under to 27 over, with an average of 14 over the March fu- tures at elevators and barge points. March 2020 corn futures closed at $3.81, down 6 cents since last Friday. For the week, March 2020 corn futures traded between $3.77


and $3.88.


Mar/May and Mar/Dec future spreads were 5 and 9 cents. May 2020 corn futures closed at $3.86, down 6 cents since last Friday. In Tennessee, new crop


cash corn contracts ranged from $3.87 to $4.13. December 2020 corn futures closed at $3.90, down 8 cents since last Friday. Down- side price protection could be obtained by purchasing a $4.00 De- cember 2020 Put Option costing 29 cents estab- lishing a $3.71 futures floor.


Soybeans Net sales reported by


exporters were down compared to last week with net sales of 17.3 million bushels for the 2019/20 marketing year and 0.1 million bushels for the 2020/21 market- ing year. Exports for the same period were up 17 percent compared to last week at 45.2 million bushels. Soybean export sales and commitments were 66 percent of the USDA estimated total annual exports for the 2019/20 marketing year (September 1 to August 31), compared to the previous 5-year average of 80 percent. Average soybean basis weakened at Memphis, Northwest Barge


Points, and


Upper-middle Tennessee and strengthened at Northwest Tennessee. Basis ranged from 17 under to 26 over the March futures contract at elevators and barge points. Average basis at the end of the week was 8 over the March futures contract. March 2020 soybean futures closed at $8.72, down 30 cents since last Friday. For the week, March 2020 soy- bean futures traded be- tween $8.72 and $9.03. Mar/May and Mar/Nov future spreads were 14 and 40 cents. May 2020 soybean futures closed at $8.86, down 29 cents since last Friday. March soybean-to-corn price ratio was 2.29 at the end of the week. In Tennessee, new crop


soybean cash contracts ranged from $8.85 to $9.39. Nov/Dec 2020 soybean-to-corn price ratio was 2.34 at the end of the week. November 2020 soybean futures


closed at $9.12, down 26 cents since last Friday. Downside price protec- tion could be achieved by purchasing a $9.20 November 2020 Put Op- tion which would cost 46 cents and set an $8.74 futures floor. Cotton Net sales reported by


exporters were up com- pared to last week with net sales of 347,100 bales for the 2019/20 marketing year and 50,200 bales for the 2020/21 marketing year. Exports for the same time period were up 16 percent compared to last week at 327,100 bales. Upland cotton ex- port sales were 81 per- cent of


the USDA


estimated total annual exports for the 2019/20 marketing year (August 1 to July 31), compared to the previous 5-year average of 77 percent. Delta upland cotton spot price quotes for January 30 were 66.3 cents/lb (41-4-34) and 68.55 cents/lb (31-3-35). Ad- justed World Price (AWP) decreased 0.70 cents to 60.59 cents. March 2020 cotton futures closed at 67.5 cents, down 1.9 cents since last Friday. For the week, March 2020 cot- ton futures traded be- tween 67.4 and 70.92 cents. Mar/May and Mar/Dec cotton futures spreads were 0.81 cents and 1.23 cents. May 2020 cotton futures closed at 68.31, down 1.89 cents since last Fri- day. December 2020 cotton


futures closed at 68.73, down 1.81 cents since last Friday. Downside price protection could be obtained by purchasing


a 69 cent December 2020 Put Option costing 4.09 cents establishing a 66.91 cent futures floor. Wheat Wheat net sales re-


ported by exporters were down compared to last week with net sales of 23.7 million bushels for the 2019/20 marketing year and 0.03 million bushels for the 2020/21 marketing year. Exports for the same time period were down 58 percent from last week at 8.0 million bushels. Wheat export sales were 79 per- cent of the USDA esti- mated total annual exports for the 2019/20 marketing year (June 1 to May 31), compared to the previous 5-year aver- age of 85 percent. March 2020 wheat


futures


closed at $5.53, down 20 cents since last Friday. March 2020 wheat fu- tures traded between $5.50 and $5.76 this week. March wheat-to- corn price ratio was 1.45. Mar/May and Mar/Jul future spreads were -1 and -1 cent. May 2020 wheat


futures


closed at $5.52, down 20 cents since last Friday. May wheat-to-corn price ratio was 1.43. In


June/July 2020 cash contracts ranged from $5.62 to $6.14. July 2020 wheat


futures


closed at $5.52, down 21 cents since last Friday. Downside price protec- tion could be obtained by purchasing a $5.60 July 2020 Put Option costing 34 cents estab- lishing a $5.26 futures floor.


∆


sistant Professor, Crop Marketing


University of Tennessee


Freezing, Thawing Aid In Seeding Legumes Over Thinning Pastures This Winter COLUMBIA, MO.


farmers overseed weak- ened pastures. Natural fluctuations in soil help work broadcast seed into thinned grass stands. “It’s no-till help,” says


P


Craig Roberts, University of Missouri Extension forage specialist. Thin stands of grass caused by


resent weather with frequent


freezing and thawing helps


improves pastures by adding legumes - a high- protein forage - to fill thin spots. That's better than overseeding more grass, Roberts says. Long-term MU research plus farm experience show legume advan- tages. “Don’t wait for spring


summer


weather, overgrazing or other reasons can be re- built. Broadcast seeds are even helped by melt- ing snow. End-of-winter seeding


to plant,” Roberts says. “Get seed on early to gain growing time when spring returns.” Tiny, hard-coated


legume


seeds remain viable in cold. They don't sprout until warm weather ar- rives. Legumes


reinforce grass pastures by adding 6• MidAmerica Farmer Grower www.mafg.net / February 7, 2020


needed nutrients for live- stock. Legume dilution helps especially in fes- cue. Adding new forage dilutes toxicosis from Kentucky 31 tall fescue. Legumes in a beef calf


pastures,


diet can add an extra quarter pound of gain per day. In addition, legumes help cow repro- duction and lactation. Another benefit is that legumes fix nitrogen from the air to add to the soil. Many legumes work in including


white and red clover and lespedeza. All are popu- lar in Missouri. Overseeding works well


in thinning stands but helps all grass stands. At planting, make sure seeds reach the soil sur- face. Too much thatch blocks contact. If not touching ground, seeds can't sprout and put down roots. Roberts recommends


seeding rates of 1/4 pound per acre for ladino clover, 8 pounds for red clover and 10 pounds for annual lespedeza. Adding legumes dilutes


toxic fescue but doesn't solve the problem alto- gether. Preventing fescue toxicosis takes replacing toxic plants with a novel- endophyte variety. Mod-


ern varieties contain a natural endophyte fun- gus that protects fescue grass but produces little or no toxic alkaloids. Replacement requires


totally killing old stands of K-31 before reseeding. Novel-endophyte vari- eties eliminate many of the workarounds needed to graze toxic fescue. Ways to seed novel-en- fescue are


dophyte


taught in advanced fes- cue schools. Those are held by the Alliance for Grassland Renewal


in


seven states across the Fescue Belt from Mis- souri to the Atlantic Ocean. Other schools are


DR. AARON SMITH: As- Specialist,


Tennessee,


in Arkansas, Tennessee, Kentucky, Georgia, Vir- ginia and North Car- olina. The Missouri


fescue


school is March 25 at MU Southwest Research Center, Mount Vernon. Southwest Center is part of the MU College of Agri- culture, Food and Natu- ral Resources. Top authorities on fes-


cue management will be at the schools. Details will come later. Stay informed on the


Alliance for Grassland Renewal website at G r a s s l a n - dRenewal.org/educa- tion.htm.


∆


Page 1  |  Page 2  |  Page 3  |  Page 4  |  Page 5  |  Page 6  |  Page 7  |  Page 8  |  Page 9  |  Page 10  |  Page 11  |  Page 12  |  Page 13  |  Page 14  |  Page 15  |  Page 16  |  Page 17  |  Page 18  |  Page 19  |  Page 20  |  Page 21  |  Page 22  |  Page 23  |  Page 24