PACE Annual Report 2008

Retailers

Market studies indicate that after a long period of increasing operational size, large growers aren’t trying to increase acreage beyond where they are today. Instead, these operations and the individuals that run them have evolved from strictly growers to business managers. In this capacity, large growers are becoming more interested in areas such as finance and credit and not as interested in “just buying products at the cheapest price.”

In some ways, retailers say they are at a relationship disadvantage with many growers when it comes to risk management. Fertilizer deals made on a handshake can create devastating risks when companies buy high and get trapped in a sudden price drop that the grower expects to receive. 

 

Seed / Biotech

Retailers say their seed profits have taken a step backward in 2008. Many say there are too many brands out in the market or competing ideas on how to effectively sell seed to grower-customers. Being a full-time seed expert and understanding how these inputs can help individual growers is the key to making this segment become more profitable in the future.

Surprisingly, the demand for conventional seed in some markets grew in 2008 as growers revolted against paying higher tech fees for biotech seed types. Still, the demand for biotech seed was growing, specifically with increased interest in LibertyLink soybeans as an alternative to Roundup Ready varieties.

 

Fertilizer

Fertilizer prices, which had been moving upward at a steady clip throughout 2007 and early 2008, suddenly headed downward, with anhydrous ammonia and urea both experiencing steep drops in price. This softening in price has many retailers that bought their fertilizer ahead (and at higher market prices) wondering how to make a profit during the 2009 growing season.

Besides price, transportation continues to be an issue. Railroads continue to balk at hauling anhydrous ammonia (NH3), driving up its price and keeping supply situations tight. Many retailers are exiting the NH3 market altogether rather than fight this distribution battle, coupled with insurance and security risks.  

 

Equipment/Precision

Bigger equipment has become the norm, with spray booms now averaging 120 feet in length. The use of automatic steering has become widespread and high clearance sprayers are on the horizon from several major manufacturers. Precision technologies continue to grow. There was big growth during 2008 in the areas of automatic boom shut-off control, automatic boom leveling systems, and GPS technology, and this is expected to continue during 2009. 

 

Biofuels/Crop Intentions

Retailers report that demand and excitement regarding biofuels has dropped off significantly, particularly for ethanol as oil prices have dropped. Many observers feel corn ethanol will not be a growth area for the industry in 2009 or beyond.

With corn for ethanol demand dropping, there are numerous predictions that soybeans will be the king row crop in 2009 — at least in terms of new planting. Corn, wheat, and cotton will all lose acres in 2009 to soybeans, which could also benefit from fewer crop input demands and higher commodity prices relative to other row crops.

 

Crop Protection

Retailers saw a significant increase in fungicide applications in many areas of the country, with many growers using these products as a way to increase their yields, particularly in corn. Still, the equipment to apply fungicides as preventives isn’t there yet for many retailers. But equipment manufacturers are planning to introduce a host of ground-based sprayers in 2009 that will be able to apply fungicides over-the-top of corn, so the market should remain strong.

Spray drift remains a big area of concern for the marketplace. New EPA drift reduction lists might contain mandatory buffer zone requirements, which the application industry opposes. “Some in government feel that based upon the evidence and our technical advances that zero drift is possible,” said one PACE Council Member. “But we need to make the point back to government that although zero drift is our goal, it’s not attainable.”

Leave a Reply

Management Stories

StewardshipMichigan Agriculture Leaders On Toledo Water Ban: We Want To Be Part Of The Conversation
August 8, 2014
Leaders of Michigan agricultural organizations said Thursday that the government should not have a “knee-jerk reaction” based on last weekend’s water ban in Toledo due to fertilizer run-off in Lake Erie. Read More
ManagementRussia Bans U.S. And EU Ag Product Imports In Ukraine Sanctions Battle
August 7, 2014
Russian President Vladimir Putin has banned the import of agricultural goods from countries that have imposed sanctions on Russia. Read More
EmployeesAsmark Institute Dedicates New Training Center To Ford West
August 6, 2014
The Asmark Institute plans to recognize the retired industry leader's years of service to the fertilizer industry at the new state-of-the-art facility in Owensboro, KY. Read More
LegislationUSDA: Quick Implementation Of Disaster Assistance Programs A ‘Top Priority’
July 9, 2014
USDA has processed 106,000 payments to farmers in 40 states across the country who suffered livestock and grazing losses between Oct. 2011 and passage of the 2014 Farm Bill. Read More

Trending Articles

Equipment2014 Product Of The Year Voting
September 19, 2014
Many new products were introduced to the ag retail marketplace this year. From this group, CropLife IRON and its consulting partners have selected five finalists for the Product of the Year award. Please cast your vote today to help us determine the winner. Read More
FertilizerFall Fertility 2014: Forecasting Fertilizer Use
September 7, 2014
Great crops this year have tapped the soil, and fall work is definitely called for, but how challenging will that get? Read More
CropLife 100CHS To Build $3 Billion Fertilizer Plant In North Dakota
September 5, 2014
The fertilizer plant in Spiritwood will be the single largest investment in CHS history, as well as the single largest private investment project ever undertaken in North Dakota. Read More
EquipmentNew Holland Acquires Miller-St. Nazianz
September 3, 2014
The assets of Miller acquired as part of the transaction will become part of New Holland Agriculture, a CNH Industrial brand, building on a successful four-year partnership between the two companies. Read More
CropLife 100Pinnacle Acquires East Kansas Chemical
September 2, 2014
Ranked 82nd on the CropLife 100, East Kansas Chemical will operate as part of Pinnacle's Performance Agriculture brand. Read More
MAGIE 2014 ShowStopper
EquipmentJohn Deere Again Wins MAGIE ShowStopper Award
August 25, 2014
For the second consecutive year, John Deere was honored at the Midwest AG Industries Exposition (MAGIE) for its new R4045 sprayer. Read More

Latest News

Photo credit: The United Soybean Board/The Soybean Checkoff.
Crop InputsArysta LifeScience Acquires French Bio-Nutrient Company
October 2, 2014
Arysta LifeScience recently announced the acquisition of Goёmar, a French company that develops bioperformance technologies for crop production. Read More
Matthew GrassiVilsack, USDA Featured On New South Park
October 2, 2014
USDA Secretary of Agriculture Tom Vilsack was featured on last night's hilarious new South Park episode titled "Gluten Free Ebola." Read More
Syngenta
Crop InputsSyngenta Launches Plant Breeding Academy
October 1, 2014
Syngenta announces the release of its Breeding Academy, a global initiative designed to enable the continued development of scientists at Syngenta and beyond. Read More
FertilizerFertilizer Outlook And Technology Conference Set For No…
September 30, 2014
Conference participants can expect to gain perspective on the outlook for agriculture and major fertilizer materials and inputs from industry experts. Read More
MicronutrientsVerdesian Acquires Micronutrient Supplier
September 30, 2014
Verdesian Life Sciences has acquired QC Corp., a producer and supplier of granular and dry micronutrients and ferrous sulfate products. Read More
Eric SfiligojHearing From Young Ag Voices
September 30, 2014
Potential future leaders in ag retail had the chance to shine at the recent Mid America CropLife Association meeting. Read More
WebinarsUpcoming Webinars
September 30, 2014
Register for one of our upcoming Webinars or access our archive of past Webinars to view recordings of presentations that may be of interest to you. Read More
Crop InputsSyngenta Appoints New Chief Operating Officer
September 29, 2014
Jon Parr will succeed retiring COO John Atkin at the end of the year. Read More
CropLife 100South Dakota Wheat Growers To Add Grain-Agronomy Facili…
September 26, 2014
Planned to be constructed in Kennebec, the facility will be located along the soon-to-be rehabilitated line of heavy-rail service from Chamberlain to Presho. Read More
CropLife 100GROWMARK Announces Vice President Appointments
September 25, 2014
Two individuals have been appointed Vice President positions on the GROWMARK executive team. Read More
FertilizerFertilizer Industry Organizations Join Global Alliance …
September 25, 2014
The Fertilizer Institute, the International Plant Nutrition Institute and the International Fertilizer Industry Association are encouraging the industry to promote the proper use of fertilizer products to minimize their environmental impact. Read More
Precision AgARA Organized Precision Forum Hits Capitol Hill
September 24, 2014
The Coalition for the Advancement of Precision Agriculture (CAPA) hosted its inaugural Precision Ag Forum, Sept. 18, in Washington, D.C. Read More
FertilizerFactors To Consider When Placing Fertilizer With Seed
September 24, 2014
The type of crop, fertilizer source, row spacing and soil environment all affect how much fertilizer can be safely applied with seed. Read More
FertilizerSidedressing Manure Into Corn Has Promising Results
September 24, 2014
Applying manure to growing crops can boost yields, reduce nutrient losses and give livestock producers another window of time to apply manure to farm fields. Read More
FertilizerWhen To Sample Manure For Analysis
September 24, 2014
Because the goal is to collect a sample that represents the manure actually being applied, the best time to sample is during loading or field application. Here's why. Read More
Syngenta
Seed/BiotechSyngenta Faces Second Lawsuit Over Agrisure Viptera Cor…
September 23, 2014
A second company has sued Syngenta AG over sales of genetically modified corn seed not approved by China. Read More
StewardshipCover Crops Field Guide For Farmers Expanded
September 23, 2014
Farmers interested in planting cover crops to improve soil health now have an updated and expanded resource in the second edition of the Midwest Cover Crops Field Guide. Read More
HerbicidesArysta LifeScience Launches Contest For Wheat Growers
September 23, 2014
The Flush after Flush Photo Finish contest encourages farmers across the U.S. to participate through Instagram or Twitter using the hashtag #FlushAfterFlush. Read More