The Many Paths Ahead For Seed

This fall growers and retailers have faced a unique combination of natural and man-made challenges that are making seed and planting decisions for the coming year more complex. Perhaps the biggest question of the season: Will there be enough seed for 2013 plantings, especially in light of the drought? Retailers we talked with have been keeping in close touch with suppliers to get the latest word. Fortunately, seed production acreage is under irrigation, so the crop was protected from some of the worse effects of the drought. But dealers are hearing quantities will be tight to “very tight,” at least on the corn side. “The challenge will be how many of the priority hybrids or varieties we can actually deliver,” says Rob Mitchell, director of national seed sales and marketing, J.R. Simplot, Boise, ID.

Indeed, Jeff Eggleston, general manager of Hintzsche Fertilizer, Maple Park, IL, says that because of supply problems the past few years, a majority of his customers’ orders have been altered at least once before seed ever gets delivered. Trying to place seed for a grower, then not have availability means going back to make substitutions, he says. It’s a time-consuming practice he dislikes intensely.

In addition to supply issues, some retailers were wondering about the quality of the seed, pointing to the impact of the summer’s excessive heat during pollination. “We’re anticipating a smaller seed size and hopefully we’re not going to see reduced germs of any kind,” says Mitchell.

And a startling trend emerged across the board as CropLife® talked with dealers: Growers are placing orders up to two months earlier than usual in order to get coveted varieties and quantities. In fact, customers might be over-ordering slightly this year as well, trying to get extra of what they really want because they know they’ll probably get cut, says Eggleston.

Product Watch

What products did growers go for in 2012 and how did crops do? Lane Mielke, sales manager at North Central Famers Elevator, Ipswich, SD, says customers particularly liked VT Double PRO seed — especially the Refuge-in-Bag product — and were willing to pay a premium for the convenience.

Mielke was surprised at how well the newer varieties performed in general this year. “We raised a heck of a good crop on limited rainfall,” he says. “Producers raised a good yield and are getting a good price for their commodity. Everybody has a smile on their face at this point.”

Kevin Mainord, sales manager for MRM Ag Services, East Prairie, MO, saw a big demand for LibertyLink (LL) products in his area this year due to glyphosate-resistant pigweed issues. The problem began six years ago and has progressively gotten worse across the state. When customers first started using LL soybeans two years ago, they were concerned about a yield drag, compared to Roundup Ready systems. But most are now seeing LL yields that are just as good, Mainord reports.

Many retailers, including Chris Klumpp, seed product line manager at Ag Partners, Albert City, IA, reported customers went for the new RoundUp Ready 2 Yield soybeans and said they got “very good performance.”

Several dealers we talked with are waiting for dicamba-tolerant soybeans as a means to combat glyphosate-tolerant weeds. But the possible volatility and off-target movement of dicamba products and subsequent damage to sensitive crops like cotton makes them cautious.

Michael Hensgens, business manager of G&H Seed Co., Crowley, LA, says dicamba and Roundup Ready 2 soybeans should raise the yield bar and increase weed control in the crop, aiding in stewardship and weed resistance prevention.

One eagerly awaited trait continues to be drought tolerance, and 2012 certainly was a good year to test the newly launched genetics. This season J.R. Simplot, which always faces plenty of water-challenged locations west of the Rockies, trialed and retailed some of the hybrids, created both by conventional breeding and genetic modifications. Mitchell says it’s too early to tell if the seed delivered. “The harvest is going on and data points are still coming in,” he says, though he adds that the company will also be watching other industry and university results as well.

5 Key Forces Driving The Seed Market5 Key Forces Driving The Seed Market
In this episode of Top Trends, CropLife Group Editor Paul Schrimpf discusses how weather, economic and political conditions are all playing a role in which direction the seed market will head in the future.

Planting Intentions

Several retailers reported that planting intentions for 2013 so far are similar to 2012, with many still “bullish” on corn acres. Mitchell projects the Gulf region may see some corn acres replace cotton. “I think it’s going to be another big year on corn, but let’s just hope we get some rainfall this fall and winter, get some recharge going.”

Dealers said they are hearing projections of 96 to 100 million acres of corn for 2013, but those impacted most by the drought in Indiana, Illinois and Iowa question the figure.

“I don’t know how we’re going to hit that,” says Dan Mogged, vice president of Van Horn, Cerro Gordo, IL. He reports dismal performance by some hybrids for the past two years in corn-on-corn fields in the region. Those kinds of results make it very difficult for his sales force to recommend one product over another to customers for 2013. He says growers have been “slammed” in these rotations, investing in pricey inputs only to get disappointing yields — 50 to 80 bushels per acre less than fields where corn followed soybeans. Mogged says he could see at least 5% of this year’s corn acres shift back to soybeans.

All Over The Road

Hintzsche’s Eggleston, also in Illinois, says planting intentions are “all over the board right now,” with some growers leaning toward more soybeans. “I would say if we don’t get some decent snowfall and rain this fall and next spring, growers may lean towards beans. Our subsoil moisture is pretty depleted.”

MRM’s Mainord thinks that if bean prices and fertilizer prices go up, “that will tend to trim the corn acres.”

Dealers are working to make seed sales a good experience for growers. A key is the value of their sales agronomists in building relationships with and conveying seed information to customers. Seed staff face a steep learning curve, especially considering the sheer number of new varieties hitting the market every year. The life cycle of a hybrid has gone down to two or three years, from five years a decade ago.

North Central Farmers Elevator has seen the benefits of ongoing customer communication. As word has spread about the company’s products and service, Mielke has had to add 18 new members to his sales force over just the past five years.

Part of seed management is pricing, including finding the rate that will bring acceptable margins. While customers may complain about seed costs, G&H Seed’s Hensgens emphasizes margins do mean value for the grower. “A farmer is the best judge of value,” he says. “If he trusts his crop advisor, he orders products with their appropriate margins providing the crop advisor service. If a grower uses a consultant, then he pays the consultant and shops price first, then compares the other services offered by the dealer. Custom application services greatly impact those decisions.”

Hensgens would say the value of traits was acceptable to growers until a “value shift” took place a few years ago — when the price of seed went up in exchange for lower herbicide prices caused by generic chemical introductions and patent expirations.

In Missouri, MRM’s Mainord sells to customers who still use public varieties. Many of the elevators in his area pay a 60-cent premium for non-GMO soybeans, which his growers have found perform very well. “In fact, most producers who grow traditional varieties will tell you they perform as well as anything that’s on the market,” he says. A sobering thought considering non-GMO seed costs $18 to $19 per bag, vs. $52 to $65 for traited seed.

A number of dealers commented that while agriculture continues to fare well compared to other industries in the current economy, they and their customers are uneasy. The latest Farm Bill has yet to be finalized, and at presstime dealers contemplated how the looming elections could greatly affect the bill’s outcome. “One year down the road, how will farm programs and crop insurance look?” asks Mogged.

Mainord thinks growers are being a little cautious in their buying decisions, even with high commodity prices. One reason in particular: How will tax structures look after the elections?

“They affect us tremendously,” he says. “Even though we handle a lot of money, sometimes we don’t get to keep a lot of it.”

Topics:

Leave a Reply

Seed/Biotech Stories

Monsanto sign
Seed/BiotechMonsanto, NRGene Form Agreement For Big Data Genomic Analysis Technology
January 12, 2017
Monsanto Co. and NRGene have announced that the companies have reached a non-exclusive, multi-year global licensing agreement on NRGene’s genome-analysis Read More
Acceleron B-300 seed coating
Crop InputsThe BioAg Alliance Advances New Microbial Solutions For Agriculture
January 5, 2017
The BioAg Alliance, Monsanto’s and Novozymes’ collaboration to improve crop harvests through products containing naturally-occurring microbes, has announced results from Read More
Seedling Closeup
Seed/BiotechExceed The Seed Symposium Lauded For Engaging Speakers, New Seed Technology Insight
December 21, 2016
The 2016 Exceed the Seed Symposium offered attendees exclusive knowledge of developing trends in seed treatment and novel technologies to Read More
Soybeans closeup
Seed/BiotechUnderstanding Inoculation Techniques For Legumes
December 20, 2016
Inoculum is not magic dust — it contains bacteria that must be kept alive. According to Penn State Extension, all packages Read More
Trending Articles
AgriSync
Matt Hopkins17 Agriculture Apps That Will Help You Farm Smarter In 2017
December 9, 2016
Ag professionals are working smarter, not harder, than ever before. Smart farming technologies have enabled them to reduce costs, maximize Read More
R4023 Sprayer, John Deere
CropLife 100Ag Retail Equipment Report: The Green Party Continues
December 7, 2016
In the annual race for sales in the ag retail equipment marketplace, the color schemes for participants are a little Read More
Mike Stern
Precision AgClimate Corp. CEO Talks Retailer Support For Digital Ag
December 1, 2016
CropLife Magazine’s sister publication, AgriBusiness Global, recently sat down with Mike Stern, CEO of The Climate Corp., following the Monsanto subsidiary’s Read More
Precision AgTrimble Debuts End-to-End FMIS Platform
November 28, 2016
October’s inaugural PrecisionAg Vision Conference left this author with many thoughts and things to ponder in the coming months. Probably Read More
CHS Primeland
CropLife 100The 2016 CropLife 100 Report: Reviewing The Many Bulls And Bears Impacting This Year’s Marketplace
November 28, 2016
For virtually all of 2016, the nation was wholly focused on the big Presidential election. Some folks aligned themselves with Read More
Monsanto sign
Crop InputsMissouri Governor Meets With Bayer CEO To Discuss Monsanto Merger
November 21, 2016
Missouri Gov. Jay Nixon visited Bayer AG global headquarters in Leverkusen, Germany, on November 18 to discuss the proposed Bayer-Monsanto Read More
Latest News
Andersons Retail Store
UncategorizedThe Andersons To Close All Retail Stores; Shutdown Does…
January 16, 2017
In a stunning announcement to the Toledo area, The Andersons Inc. said on Sunday that it would close its two Read More
Trimble TMX-2050 In-Cab Display
Eric SfiligojPrecision To Lead Agriculture In 2017?
January 16, 2017
Another new year is upon us! And I’m certain I speak for many in the agricultural world when I say Read More
Corn
Eric SfiligojThe Mood From Madison? In A Holding Pattern
January 16, 2017
Last week, I had the chance to attend the annual Wisconsin AgriBusiness Classic show in Madison, WI. It’s been a Read More
Syngenta Sign
Crop InputsAccenture Helps Syngenta Transform Its Global Logistics
January 13, 2017
Syngenta, a leading agriculture company, has collaborated with Accenture to design and implement a new digital logistics operating model across Read More
Fall Creek Seth Harden The Nature Conservancy
StewardshipLocal Farmers’ Watershed Initiative: Continuous Improve…
January 13, 2017
The goal in the Big Pine Watershed Project is to more intentionally do what local farmers and responsible ag retailers Read More
HerbicidesEPA Expands Enlist Duo Herbicide Registration To 34 Sta…
January 13, 2017
The U.S. EPA has expanded the geography for application of Enlist Duo herbicide from 15 to 34 states. This means Read More
Olson Ag Enterprise
CropLife 100Wilbur-Ellis Acquires Nebraska Seed Retailer
January 13, 2017
Wilbur-Ellis’ Agribusiness, a recognized leader in precision agriculture technology and the distribution and marketing of plant protection, seed and nutritional Read More
ManagementDeere-Precision Planting Update and the Ag Secretary Wa…
January 12, 2017
Editors Paul Schrimpf and Eric Sfiligoj provide the latest on the court date for John Deere/Precision Planting and the quest Read More
Monsanto sign
Seed/BiotechMonsanto, NRGene Form Agreement For Big Data Genomic An…
January 12, 2017
Monsanto Co. and NRGene have announced that the companies have reached a non-exclusive, multi-year global licensing agreement on NRGene’s genome-analysis Read More
AGCO Custom applicator
SprayersAGCO, Asmark Institute To Offer Training For Beginning …
January 11, 2017
AGCO Corp. and the Asmark Institute are collaborating to offer a new training program dedicated to educating and developing custom Read More
ManagementAg Land Values In Limbo In 2017
January 10, 2017
Several factors will come into play in 2017 that will determine the direction of land values. Randy Dickhut, senior vice Read More
Industry NewsPattison Agriculture Positioned To Be Leading Canadian …
January 10, 2017
Pattison Agriculture Limited (Pattison Agriculture), a division of The Jim Pattison Group (the Pattison Group), has announced the merger of Read More
Fertilizer Tender close-up
MicronutrientsHow Micronutrients Fit Into 2017 Fertility Plans
January 10, 2017
Where do micronutrients stand going forward in fertility plans? For one thing, Tim Mundorf, Field Representative with Midwest Laboratories, says Read More
Fertilizer application
State of the IndustryCautious Optimism On Fertilizer In 2017
January 10, 2017
What kind of fertilizer rates are growers and retailers looking at in 2017 and beyond? According to stakeholders CropLife magazine Read More
Asmus Farm Supply crop protection products in storage
State of the IndustryCrop Protection Products Market: Complexity Begets Oppo…
January 10, 2017
While other key market segments in agriculture continue to see tumultuous shifts in sales volumes going forward (large equipment sales are Read More
RoGator RG1300B AGCO
Sprayers10 Sprayers That Will Showcase The Latest Application T…
January 10, 2017
Sprayer manufacturers continue to step up their games with the latest in application technology. From direct injection systems and four-wheel Read More
Soybean Field
FungicidesGrowers Report Yield Boost, Extended Residual Disease C…
January 9, 2017
With the new growing season around the corner, it’s time to start thinking about inputs for 2017. As growers weigh Read More
Donald Trump
Eric SfiligojTrump’s New Ag Secretary Coming Soon?
January 9, 2017
As agricultural experts are quick to point out, incoming President Donald Trump largely has the nation’s growers to thank for Read More