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4 CapitalPress.com September 23, 2016 Big crops, high dollar mean tough year for grain growers By CAROL RYAN DUMAS Select U.S. grain prices Capital Press (Dollars per bushel, by marketing year) Another year of bumper crops and high inventories is likely to spell another year of lower prices for corn, soybean and wheat growers, and alter- nately keep some feed costs in check for livestock producers. Ag economists at Purdue University’s Center for Com- mercial Agriculture laid out what grain growers are facing in a crop outlook webinar on Sept. 13 based on USDA’s lat- est crop estimates and world supply and demand report. The wheat crop is expect- ed to bring record yields of 52.6 per acre, although lower acreage won’t bring record production. But at 2.3 bil- lion bushels, it’s the largest crop since 2003, according to USDA. “We hear the stories from Crop 2012-13 Corn Soybeans Wheat $6.89 14.40 7.77 Source: USDA 2013-14 2014-15 2015-16 2016-17* $4.46 13 6.87 $3.70 10.10 5.99 *Projected Kansas up through Montana of farmers just piling wheat on the ground because of such huge yields this year,” Chris Hurt, professor and extension ag economist, said. Inventories are also an is- sue, with decade-high inven- tories of corn and soybeans and the highest inventory of wheat since 2009 by the end of the marketing year. Approximately 50 percent of a full year’s use of wheat at the end of next May will be $3.60 8.95 4.89 $3.20 9.05 3.60 Capital Press graphic leftover when harvest begins on next year’s crop in June and July, he said. “That tells us that in terms of the U.S. our biggest prob- lem of the major grains would be wheat, problem being with a surplus situation. That’s an extraordinary number. That would suggest to us that prob- ably wheat prices will be de- pressed,” he said. Corn inventories are at their highest since 2005, with an expected carryover of 16.5 percent of a full year’s usage. Soybean inventories are at the highest since 2006, with an expected carryover of 9 percent of a year’s usage into next year’s crop, he said. Wheat is in the most des- perate surplus, corn is second and soybeans are not as dire. With corn and wheat some- what interchangeable in ani- mal feed, wheat supplies and prices will be a drag on corn demand and prices. And given prices, more wheat and corn acres are likely to shift to soy- beans in 2017, he said. Corn producers are looking at a record crop of more than 15 billion bushels, nearly 1 billion bushels above the pre- vious record in 2014, with pro- jected record yields of 174.4 bushels per acre, Hurt said. It’s a big crop that’s com- ing at a time when the dollar has appreciated substantially, making it harder to sell into the world market, and ethanol demand growth has leveled off. And it’s the third year of very good yields, he said. “There’s no question that the depressed prices we have are certainly related to these very good yields, above-trend yields, and some of the ex- tremely high prices we had back in ’10, ’11 and ’12 were related not only to the strong demand but also to the smaller crops,” he said. This year’s production is remarkable, considering that it’s a 50 percent expansion from the 10 billion bushel corn crop 10 years ago at the start of the ethanol growth, he said. “Amazing what American farmers have been able to do, but we’ve seen the con- sequences in terms of price as well,” he said. USDA is projecting corn prices to range from $2.90 to $3.50 a bushel. The story in soybeans is more of the same, only worse, with yields higher than trade was expecting at a project- ed 50.6 bushels per acre and close to 5 bushels above ex- pected trend yields. It will also be the third consecutive year of record yields and re- cord production at an estimat- ed 4.2 billion bushels, he said. In addition to the challenge of a stronger dollar, Chinese purchases of soybeans have slowed although they’re still strong, he said. USDA is expecting soy- bean prices to range from $8.30 to $9.80 a bushel. The wide range relects the un- certainty in yields and inal production as well as what the demand structure is going to be, he said. Pack removal rekindles wolf debate in Washington Hazelnut growers Profanity Peak elimination continues reach minimum price agreement with packers By DON JENKINS By ERIC MORTENSON Capital Press Capital Press ISSAQUAH, Wash. — Washington wildlife managers have yet to end an operation to remove the Profanity Peak pack, but a debate about how the state will react to future wolf attacks on livestock has already started. The Department of Fish and Wildlife’s Wolf Advisory Group convened Sept. 14 at a Holiday Inn for a meeting scheduled before WDFW be- gan shooting wolves in the Colville National Forest. The group didn’t discuss the operation, but many in the audience of about 50 people brought it up. The meeting was occasion- ally heated as wolf advocates said the state shouldn’t shoot wolves on public land to pro- tect cattle, a position described by others as contributing to rural discontent over wolves recolonizing northeast Wash- ington. Meeting moderator Fran- cine Madden and WDFW staff members defused tensions by repeatedly thanking people for their opinions and interest. “I love your passion,” WDFW wolf policy coordinator Donny Martorello told everyone. WDFW has been hunting the Profanity Peak pack since Aug. 4, enacting a policy agreed to by the Wolf Adviso- ry Group. The group includes envi- ronmental and animal-welfare groups. They accepted a pol- icy that allows for wolves to be shot if preventive measures don’t stop depredations. The response from environ- mental groups not involved in writing the policy was relative- ly muted when WDFW said it would remove part of the pack. The atmosphere changed Oregon’s hazelnut growers, with growth and market ques- tions always in the background, agreed to a minimum price this year of $1.18 per pound. The igure is the loor price, the lowest amount growers will receive from packing compa- nies for nuts harvested this year. The inishing price is typically higher. Farmer Doug Olsen, pres- ident of the Hazelnut Growers Bargaining Association, called it a good starting point. The initial minimum price was $1.22 in 2015 and a record $1.70 per pound in 2014, when a bad freeze hammered Turkey, by far the world’s largest pro- ducer, and demand for Oregon nuts jumped in response. Olsen said the initial mini- mum price decreases since then aren’t a major concern. He said 2014 was an anomaly — “Un- heard of,” he said of the price — and the four cent drop from 2015 doesn’t amount to much. In a Sept. 16 news release announcing the price agree- ment, growers’ representative Terry Ross attributed the dip in price to a “decent” Turkish crop and a carryover of nuts, and good supply of nuts that com- pete with hazelnuts in various uses. Those include almonds, walnuts, pecans and pistachios, according to the news release. In addition, the Turkish lira is weak against the U.S. dollar, making Turkish nuts cheaper. That could eat into the export market for Oregon growers. Olsen, the bargaining as- sociation president, said luc- tuation in the initial minimum price isn’t a big deal. In 2014 and 2015, the ending price was 6.5 percent and 13 percent higher, respectively, than the initial price. Don Jenkins/Capital Press Stevens County rancher and range-rider Arron Scotten gestures while speaking Sept. 14 in Issaquah at a meeting of the Washington Department of Fish and Wildlife’s Wolf Advisory Group. Scotten told wolf advocates that not allowing for the lethal removal of cattle-killing wolves will lead to more depre- dations on livestock and more culling of wolf packs. Meeting facilitator Francine Madden and Humane Society of the U.S. state director Dan Paul look on. Don Jenkins/Capital Press Washington Department of Fish and Wildlife wolf policy coordina- tor Donny Martorello talks Sept. 14 in Issaquah at a meeting of the department’s Wolf Advisory Group. About 50 people were in the audience, many upset with WDFW for shooting wolves in the Colville National Forest. when WDFW announced Aug. 19 that shooting two wolves had failed to stop depredations and that the department intend- ed to kill the entire pack. En- vironmental groups, including some on the advisory group, say WDFW should reconsider the lethal-removal policy. On the ground, ranchers and WDFW staff members have received death threats. “It’s been a really hard nine weeks,” Martorello said. “All the prep didn’t prepare us emotionally for what we’ve been through.” WDFW has so far shot six wolves. Two adult wolves and perhaps four pups remain in the pack. WDFW has not pro- vided an update on the opera- tion since Sept. 2. Martorello said the department will re- lease one Friday. WDFW also has promised a post-operation report, in- cluding details on where cattle were released, efforts to pre- vent depredations and the rea- soning behind WDFW Direc- tor Jim Unsworth’s decision to authorize total pack removal. Following its policy, WDFW waited until four con- irmed depredations on live- stock before shooting wolves. The conirmed depredation count has reached eight. In an almost equal number of cases, WDFW investigators have concluded that wolves probably attacked livestock, but they couldn’t absolutely rule out another predator. Stevens County Commis- sioner Don Dashiell, a member of the advisory group, said that earlier intervention might have made removing the entire pack unnecessary. “By the time you get to four conirmed depredations, there’s been a lot more kill- ing going on,” he said. “To do incremental take, you need to start with the irst depreda- tion.” Group member Paula Swedeen of Conservation Northwest noted that in some cases stepping up non-lethal protections has stopped dep- redations, but she agreed the group should discuss earlier intervention. “It’s an open question that warrants serious consider- ation,” she said. “We need to take a hard look at the science and dive in deeply for the next protocol.” (ALL GAUGES) WAREHOUSE PACKAGING: • Stretch Film • Pallet Sheets • Pallet Covers LOCATIONS: Albany, Oregon (MAIN OFFICE) Ellensburg, Washington CONTACT INFORMATION: Phone: 855-928-3856 Fax: 541-497-6262 info@westernpackaging.com ....................................................... CUSTOMER SERVICE IS OUR TOP PRIORITY! www.westernpackaging.com 39-1/#5 39-4/#04X HAY PRESS SUPPORT: • Hay Sleeves • Strap • Totes • Printed or Plain • Stretch Film “As long as it stays above $1, I think the interest to plant is still there,” Olsen said. “Interest to plant” has been hazelnut growers’ operative phrase for many years, as the industry continues to add 1,500 to 2,000 acres per year, Olsen said. He estimated Or- egon now has about 60,000 acres of hazelnuts, with about 35,000 acres in production. Willamette Valley grass seed growers, in particular, have converted ields to hazelnuts. It takes three or four years for trees to begin producing nuts. One of the open questions in the business is whether a ceiling exists for Oregon hazelnut acreage. As things stand, Oregon dominates U.S. production but is a tiny pres- ence on the international mar- ket, even with strong sales of snack nuts to China. Growers wonder if in- creased production might attract a company to build a manufacturing plant in the Willamette Valley. Hazelnuts are used in candies, baked goods and spreads such as the popular brand Nutella. Noted Oregon State Uni- versity researcher Shawn Mehlenbacher has speculated in the past that Oregon could double its hazelnut produc- tion just to replace nuts now imported into the U.S. from Turkey. In August, OSU was award- ed a $3.1 million, ive-year USDA grant to continue re- search. Mehlenbacher is cred- ited with saving the industry in Oregon by breeding varieties that could resist Eastern ilbert blight. In its grant application, OSU indicated the money would be used to expand com- mercial hazelnut production in the U.S., with a focus on the Paciic Northwest. Oregon’s crop was worth close to $90 million in 2015. LEGAL WE S P E CIA LIZE IN B U LK B AG S! BAGS: • Seed Bags • Fertilizer Bags • Feed Bags • Potato Bags • Printed Bags • Plain Bags • Bulk Bags • Totes • Woven Polypropylene • Bopp • Polyethylene • Pocket Bags • Roll Stock & More! Courtesy of Hazelnut Industry Ofice Hazelnuts tumble from a tote after harvest. Growers have agreed to a minimum price this year of $1.18 per pound. CHERRY AVENUE STORAGE 2680 Cherry Ave. NE Salem, OR 97301 (503) 399-7454 Sat., Oct. 8th • 10 A.M. • Unit 19 Austin Rodriquez • Unit 24 Art Espinoza • Unit 85 Angela Kinzel • Unit 92 Renan Chavez • Unit 104 Charles Mitchell • Unit 140 Eric & Jordan Hagen • Unit 142 Angelique Goldschmidt • Unit 210 Jamie Parks Cherry Avenue Storage reserves the right to refuse any and all bids legal-39-2-1/#4
