Hursh Consulting & Communications: Kevin Hursh on Agriculture

566 Adilman Drive, Saskatoon, SK Canada, S7K 7H5
Tel: (306) 933-0138 Fax: (306) 249-4869 kevin@hursh.ca

Hursh on Agriculture

March 31, 2005

Seeding Rate Calculator
Size matters when it comes to seed. That’s why it’s valuable to know the thousand kernel weight of the seed you’re planting. Take two samples of peas. Both have a germination of 96 per cent and both have a seed vigour of 94 per cent. For both samples, you assume a seed mortality of 10 per cent. The only difference in the two samples is the size of the seed. Sample one has a thousand kernel weight of 260 grams. Sample two has a thousand kernel weight that’s slightly lower – 223 grams. Let’s assume you want to end up with a plant population of 8 per square foot. With the bigger pea seeds, you need to plant 252 pounds per acre. With the slightly smaller seeds, you’d only want to put 198 pounds of seed per acre in the ground. Alberta Agriculture has an on-line calculator where you can plug in germination rate, mortality, seed size, the thousand kernel weight and your desired plant count. The calculator will tell you how many pounds of seed are required per acre. The Web site address for the calculator is www.agric.gov.ab.ca/app19/calc/crop/otherseedcalculator.jsp I’m Kevin Hursh.

March 30, 2005

Pressure is off the feds
Keystone Agricultural Producers in Manitoba has been planning a march for agriculture to be held on April 11. With this week’s federal announcement of a billion dollars for farmers, KAP has cancelled the event. In Saskatchewan, APAS has been threatening to become more assertive in lobbying for government support. Now, APAS is giving mild praise to the assistance package. In Ontario, there have been a couple of big farmer rallies at the legislature. Ontario farmers are receiving the federal assistance, as well as a new assistance package from the province. That’s likely to keep farmers and tractors out of downtown Toronto. There is still a farm income problem. While governments talk about reformative change so farmers can get their returns from the marketplace, no long-term plan is evident. But the federal government seems to be listening and trying. The new assistance package is rough justice, but the much-needed cash should be delivered in a timely manner. The farm lobby was gearing up and becoming more militant. The pressure is now off, at least for the time being. I’m Kevin Hursh.

March 29, 2005

Welcome money from Ottawa
Here’s what the new billion dollar income assistance program will mean for farmers. Most of the money, $840 million, is being paid to grain and livestock producers based on their five-year average of eligible net sales. For a grain producer, these are grain sales minus seed purchases. An initial payment of 4.4 per cent of eligible net sales is supposed to be paid by the end of April. This will later be topped up to around 5.5 per cent. So a typical Saskatchewan producer with an average of $100,000 in eligible net sales should receive a total of around $5500 with $4400 of that coming at the end of April. The other part of the program involves payments for cattle and other ruminants. Just like the program of a year ago, a payment will be made on young animals that were on the farm as of December 23, 2003. Mature cows and bulls are not included. The payment will be $19 a head for cattle, $68 for bison, $14 for sheep and goats, $34 for elk and $17 a head on deer. Eighty per cent should be paid around the end of April with the balance coming later. For both the ruminant and general payments, the money for most producers will come without a need to fill in application forms. I’m Kevin Hursh.

March 28, 2005

More drastic BSE action proposed
The Canadian Cattlemen’s Association is taking a much harder line on the BSE crisis. At its annual general meeting late last week in Ottawa, a new BSE action plan was approved. Many of the items are not surprising – increasing Canadian slaughter capacity, extension and enhancement of the set aside programs, changes to the CAIS program and the elimination of supplementary import quotas. Other parts of the action plan are a departure from the usual CCA stance. Rather than friendly persuasion, the association is now calling for the commencement of trade dispute actions by the federal government. The CCA is also calling for a comprehensive evaluation of export certification, including BSE testing for market access. Up until now, BSE testing has been strictly science based. Furthermore, the CCA says an emergency cattle harvest slaughter strategy should be prepared so that it could be implemented quickly if necessary. The Canadian Cattlemen’s Association seems to have decided that more drastic action is warranted. I’m Kevin Hursh.

March 27, 2005

Cuban opportunity
The time is ripe for Canada to recapture agricultural markets in Cuba. That’s the view of Wendy Holm, an agricultural economist and writer from British Columbia. Holm says that since 2002, Canadian food exports to Cuba have fallen dramatically, replaced by American exports. Cuba is still under the long-standing American economic blockade that prevents direct trade, but Holm says there was a convenient loophole for American agri-business starting in December of 2001. Now, American access is about to be diminished. Wendy Holm says a new American rule requires full payment for U.S. food products destined for Cuba before leaving American ports. That is expected to cut American business and reopen opportunities for Canada. In mid-December, Cuba opened its border to Canadian beef from animals of any age. They are also significant importers of vegetables, cereals and dairy products. Canada is Cuba’s most important source of tourists. It would be nice to be Cuba’s number one source of food imports. I’m Kevin Hursh.

March 23, 2005

Good news for those who haven't made CAIS deposits
Sometimes, it doesn’t pay to be early. That’s the situation for farmers who have dutifully made their deposits to the CAIS program. The deposit deadline has now been extended a further year. Rather than the end of this month, the deadline has been moved to March 31 of 2006 to give governments time to develop an alternative to farmer deposits. This is good news for those of us who haven’t made a deposit yet. We won’t have to tie up cash to participate in the income stabilization program. However, producers who have already made their deposits won’t be able to get their money back right away. Amounts above the required deposit can be withdrawn, but producers will have to contact the CAIS administration and it could take about a month to get the money. Withdrawing the main part of the deposit will take longer, perhaps much longer, because it requires some basic changes to the program. Farmers across the country have about $650 million on deposit with CAIS. Some of this amount will be money above the required deposit and should be available to producers within about a month, but most of the $650 million is going to be stuck for goodness knows how long. I’m Kevin Hursh.

March 22, 2005

Some balance in the pesticide debate
CropLife Canada has launched a major communications initiative to give its side of the debate regarding pesticide use. The trade association plans to tell Canadians how many tests are required before a pesticide is ever registered. They will also attempt to explain that maximum limits for pesticide residue in food are set with a huge safety margin. For example, for a particular pesticide, a 150 pound man would have to eat 3,000 heads of lettuce every day of his life to exceed the pesticide level found to have no effect on lab animals. CropLife Canada quotes the Canadian Cancer Society recommendation that people should eat 5 to 10 servings of vegetables and fruit every day to help reduce cancer risk. Further, the Cancer Society says using pesticides to protect our food helps to ensure that a variety of affordable fruits and vegetables are available. For too long, Canadians have only been hearing from those opposed to pesticide use. It’s good to see CropLife Canada participating in the debate and providing some balance. More information is available at www.croplife.ca. I’m Kevin Hursh.

March 21, 2005

It all starts with the seed
Seed testing labs are reporting a lot of samples with poor germination. Little wonder, given last year’s August frost followed by wet harvest weather. On crops like flax, good seed is in short supply and it’s expensive. With regular flax selling for $14 or even $15 a bushel, flax suitable for seed is particularly dear. There are seed problems every year. In some cases, the germination of a bin-run sample seems acceptable, but when the seed is cleaned, there’s mechanical damage and the germ drops dramatically. In other cases, particularly if stored at high moisture, germination can decrease between harvest and seeding time. As farmers, we should retain samples of what we seed. If something goes wrong, at least the sample can be re-checked. Beyond good germination, it can also be revealing to also know the vigor of the seed being used. It’s important to note that crop failure due to a seed problem is not an insurable loss under Saskatchewan Crop Insurance. You wouldn’t know it by the weather, but in five or six weeks, seeding could be underway. Many producers are still making seeding decisions and lining up seed supplies. I’m Kevin Hursh.

March 20, 2005

American BSE misconceptions
An editorial last week in The New York Times shows the lack of understanding many Americans have on the BSE issue. According to the editorial, “The only responsible way to resume international trade in beef is to test the cattle – all of them, if need be – and to bring a categorical end to the feeding practices that can spread mad cow disease”. On the issue of feeding practices, Canadian and American rules have been nearly identical and Canadian rules will soon be more stringent. On the issue of testing every animal, why test animals under 30 months of age? BSE doesn’t show up in young animals. Americans like to believe that we have BSE and they don’t. The case of BSE found in Washington state was a cow that came from Canada. There are a whole lot of other Canadian cows in the U.S. and vice versa. Animals moved back and forth across the border quite freely prior to 2003. If the New York Times did its homework, it would realize the only difference between the two countries is that the U.S. has been lucky enough or deceptive enough not to find a homegrown BSE case yet. I’m Kevin Hursh.

March 18, 2005

Hail insurance rates should drop for most producers
While most farmers are facing higher premiums for Saskatchewan Crop Insurance coverage this year, the opposite should be true for hail insurance. Murray Otterson of Saskatchewan Municipal Hail Insurance says on average hail insurance rates are likely to soften a bit. The rates are calculated township by township depending upon the claim history, so not everyone will see a drop. However, 2004 saw lower than normal hail claims over most of the province and that should be reflected in dropping premium rates for most producers. Otterson says another benefit is coming from a gradually reducing cost for re-insurance. Following the 9/11 disaster, the cost of re-insurance escalated dramatically. While 9/11 caused massive losses in the insurance industry, the years following the terrorist attacks have brought record profitability. Gradually, re-insurance rates are becoming more reasonable and that has a direct effect on the hail insurance industry. Hail insurance companies need to have the backing of re-insurance. Unlike Crop Insurance, producers pay the entire cost of hail insurance, but it’s a competitive business with a number of firms competing to offer the most attractive premiums. I’m Kevin Hursh.

March 16, 2005

Cotton decision has wide-ranging ramifications
A World Trade Organization ruling on the U.S. cotton subsidy program may be important for farmers in many countries. The case was initiated by Brazil a couple years ago. The WTO has now determined that many elements of the U.S. cotton program are not in compliance with world trade commitments. Observers say the ruling will have implications beyond cotton to other commodities and could reach beyond the U.S. to the subsidy programs of the European Union. The WTO has decided that U.S. export credit programs are export subsidies. The result, say trade experts, is that export credit programs provided by the U.S. for products like cotton, soybeans and rice will have to be modified or eliminated. It has also been determined that programs like marketing loans, counter cyclical payments and market loss payments are not necessarily “green”. In other words, they can distort trade and can be challenged. Observers say this may lead to challenges of these programs for other commodities, such as soybeans. Three cheers for Brazil for having the fortitude to challenge the U.S. and win. It will be interesting to see where this issue proceeds. I’m Kevin Hursh.

March 15, 2005

Cash flow assistance
Cash flow is always a consideration at this time of year. It takes a lot of money to put a crop in the ground. There are a few recent developments that will help. First of all, it looks like a deposit will not be required by the end of March for the CAIS program. There hasn’t been an official announcement, but sources indicate the deadline will be extended and farmers won’t have to put aside this cash. The Canadian Wheat Board recently made an announcement that’s helping with cash flow. The CWB has changed the Early Payment Option so farmers can get their money sooner. Previous deliveries of wheat, durum and barley can now be applied to new EPO contracts. The only downside is a small discount that a producer must pay. Producers still remain in the pool account and are eligible for any increase in prices above their Early Payment Value. The uptake by farmers has been large. There is also the federal government’s Spring Credit Advance Program. Farmers can sign up for this interest free cash advance beginning March 21. The Canadian Wheat Board administers the program for wheat, durum and barley. Application forms will be available through local elevator agents. I’m Kevin Hursh.

March 14, 2005

Cattle prices plummet
News that the American border will stay closed to Canadian cattle for the foreseeable future has hit markets hard. Saskatchewan Agriculture reports only 5,000 head of feeder cattle went through provincial markets last week - about one-quarter of the number that sold a couple weeks ago. Many auction markets didn’t have enough animals to conduct sales. On what did sell, prices were dramatically lower. Saskatchewan Agriculture reports prices were down $11 to $21 per cwt compared to the previous week. Lightweight feeders took the biggest hit. A lot of feedlots have withdrawn from the market. With fed steer prices down by more than $10 per cwt, feedlots have seen profits evaporate on their existing inventory. Now there are new fears that R-CALF could be successful in closing the border to boxed beef. That would be an absolute disaster for beef movement and prices. The cattle industry desperately needs some good news – something to provide optimism. Without that, feedlots are not going to be eager buyers and feeder cattle prices will continue to languish. I’m Kevin Hursh.

Crop Insurance deadline nears
As producers ponder their Crop Insurance coverage options for the upcoming year, they should consider the Annual Crop Weather Based Program. Some producers don’t like the idea of basing insurance coverage – even top-up coverage – on the rainfall and temperatures at a selected weather station. Even a nearby weather station can have far different conditions than your farm. Plus the program provides no protection for a multitude of other weather problems such as hail or wet harvest weather. That said, I believe the $10 an acre top-up to regular insurance is a good deal. A producer pays only about 38 per cent of the premium cost. Since the program is based purely on the statistical probability of rainfall being short or frost being early, on average this program is likely to pay out more than a producer pays in premiums. The $25 an acre top-up may be worth considering. It runs the same way, but the producer pays most of the premium, so it’s not such a sweet deal. Producers with pastureland should consider the forage rainfall insurance program. The deadline for making changes to Crop Insurance coverage is March 31. I’m Kevin Hursh.

March 10, 2005

Record number of pigs in Saskatchewan
Saskatchewan’s hog industry has been steadily growing. There are more pigs in Saskatchewan now than at any time in our history. At last count, there were 1.34 million – more pigs than people. The number of pigs has more than doubled since the late 1980s. Production has steadily become more efficient, so more pigs are being marketed per sow than ever before. More than two million market hogs per year are now being produced in Saskatchewan. Hog producers went through a number of tough years and there’s still evidence of the financial fallout. But the industry has been profitable for the past year, and the future looks bright. An American antidumping duty on live hogs was reduced this week, dropping from 14.06 per cent down to 10.63. There’s optimism the duty may be dropped altogether next month when the U.S. International Trade Commission rules on the issue. With the border still closed to live Canadian cattle and with most grain prices depressed, the hog industry is a welcome bright spot in agriculture. I’m Kevin Hursh.

March 9, 2005

SARM endorses economic development strategy
Delegates attending the Saskatchewan Association of Rural Municipalities convention in Saskatoon have unanimously endorsed the recommendations of the association’s Clearing the Path Committee. It’s an initiative with wide ranging implications. Rural municipalities have agreed to work together through Sector Specific Planning Commissions to establish common standards for economic development. Municipalities have also agreed to work on revenue and cost sharing agreements. That will give municipalities an incentive to work together to attract economic development to an area. Clearing the Path also calls for the development of primary weight freight haul corridors. A large area of Saskatchewan doesn’t have access to highways or roads that allow primary weights. RMs agree that a corridor of gravel surface primary weight roads should be developed with these roads linking to the primary highway system. A lot of discussion and a lot of compromise will be needed to implement the Clearing the Path recommendations, but RMs have taken a big step forward just by developing and agreeing to the concepts. I’m Kevin Hursh.

March 8, 2005

Importing lower priced glyphosate herbicide
After nearly five years, Farmers of North America has finally achieved the importation of a lower priced glyphosate herbicide through the Own Use Importation program. An American herbicide known as ClearOut 41 Plus has been deemed chemically equivalent to a glyphosate registered in Canada. Individual members of FNA will be the actual importers of the product. FNA will just help with logistics and administration. Under the program, the product is only to be used by the importing farmer and cannot be resold. According to the FNA, the price including freight will be about $4.50 a litre, about $2 a litre less than competing products. Compared to the huge market that exists for glyphosate, the amount of ClearOut 41 Plus that’s likely to be imported will be relatively small. However, there should be major cost savings for individual farmers and over time it may have an influence on the price charged for comparable products. It’s great to see the Own Use Importation program can actually work. Hopefully there will be other chemically equivalent products that farmers will be allowed to import in the future. I’m Kevin Hursh.

March 7, 2005

U.S. border likely to stay closed for months
The American border will probably stay closed to Canadian cattle for at least three months and more likely 8 to 11 months. That assessment comes from Ted Haney of the Canada Beef Export Federation. Haney doesn’t claim to be an expert on the American legal process, but he attended briefings that included legal analysis from Canadian lawyers. If Haney is correct, the border won’t be opening in a matter of days or weeks. In fact, if the injunction is made permanent, the whole legal process could take more than a year. According to Haney, it is also clear that the Canadian government and Canadian industry have been excluded from the American legal process and cannot directly affect it in any meaningful way. This information from Ted Haney is contained in an email distributed widely in the beef industry. Haney is currently on a trade mission overseas, trying to open Asian markets to Canadian beef. I called him in Taiwan to see if his assessment could be released publicly. Haney said that while his email wasn’t meant for public consumption, he believes the likely time frame on the U.S. border is information that should be widely known. I agree. I’m Kevin Hursh.

March 6, 2005

Where's the beef?
For all the talk by governments about expanding beef slaughter and processing capacity, they’re offering precious little. On Friday, Saskatchewan Agriculture announced a $16,000 invesment in new production equipment for the Saskatchewan Food Industry Development Centre. The centre does good work, but a media event to announce an additional $16,000 investment? The province also likes to boost about $55,000 it paid to fund a study into the development of the province’s beef slaughter and processing sector. These are minor league responses to a major league problem. Governments shouldn’t be picking winners and losers, nor should they get directly involved in business. But what about loan guarantees to proposals that meet certain criteria? What about bridge financing? What about a break on provincial sales tax? What about incentives for producers to invest? There are many tools governments could employ. There’s a general recognition by the entire beef industry that more domestic processing capacity is needed. The federal and Saskatchewan governments have provided lip service to this goal, but not much more. I’m Kevin Hursh.

March 4, 2005

CAIS deposit requirement unclear
It was widely expected that federal and provincial agriculture ministers meeting in Ottawa would finally do the right thing and axe the deposit requirement for the CAIS program. Farmers and farm groups across the country are united in saying it makes no sense for farmers to be required to put thousands of dollars on deposit just to access the ag income stabilization plan. Well, agriculture ministers talked about CAIS and here’s what they had to say in their joint communiqué. “Officials were directed to develop alternatives to the current CAIS deposit to be presented to Ministers at their annual meeting in July…” Further along, the communiqué says, “Ministers agreed there is a need to deal with the deposit deadlines for the 2003 and 2004 program years. Details will be announced by March 31.” Talking about alternatives at the July meeting won’t do any good. The current rules call for deposits to be in place by the end of March. However, the communiqué makes it sound like the deposit deadline might be extended. Unfortunately, it still isn’t clear what’s going to happen. I’m Kevin Hursh.

March 2, 2005

American protectionism
Many people are convinced that Canada’s foreign policy decisions are the reason for the continued closure of the American border to cattle and other ruminants. Canada did not support the American war effort in Iraq. There are those who argue that if we had stood shoulder to shoulder with the Americans, the border would long ago have been open. That’s doubtful. Great Britain stood shoulder to shoulder with the U.S. and Britain has still been subject to protectionist American trade policies. On Wednesday, a court in Billings, Montana issued a temporary injunction to the protectionist group of wing-wangs known as R-CALF. The border opening has again been delayed. This comes on the heels of Canada saying no thanks to the American missile defense plan. Some say the two are related – that if we’d kept quiet about missile defense for a while, it would have been easier to get the border open. This theory makes for great coffee shop chatter, but it’s not very plausible. Besides, Canada is a sovereign nation. Important foreign policy decisions shouldn’t involve “sucking up” to the United States. I’m Kevin Hursh.

March 1, 2005

Cattle bacteria do not infect humans
The bacteria shed by cattle do not affect humans. When water-borne bacteria make humans sick, the bacteria are probably coming from human effluent. Those are the results in a new study released by the University of Calgary. Dr. Merle Olson, director of the Medicine Animal Resource Centre says certain strains of Cryptosporidium and Giardia are intestinal parasites that can infect humans. However, he says genetic testing showed the strains of bacteria shed by cattle are not infectious to humans. They look the same under a microscope, but genetically, they are different. The one exception is that young calves will shed a form of Giardia that can cause so-called “beaver fever” in humans. However, Olson says the calves are only infectious during the first two or three weeks of their lives and in most cases they aren’t out on the range areas that make up watersheds at that young age. Olson is a veterinarian who is both a microbiologist and a gastrointestinal specialist. He notes that proper management of grazing livestock is still important, but that it’s really human-related activity that poses the main risk to human health. I’m Kevin Hursh.

Hursh on Agriculture

Archives