March 21, 2017

Building Extension 3.0


Kim Kidwell, Dean of the College of ACES - University of Illinois

Extension personnel facilitate the translation of many of the fantastic discoveries made at land-grant universities to people around the world. Oftentimes, this is the only way that this valuable information reaches people so they can make good decisions that improve the qualities of their lives. Kim Kidwell, Dean of the University of Illinois College of ACES, believes Extension embodies the essence of the land-grant mission because this is where transformation happens. She discusses, with Todd Gleason, how the future of Extension in the state of Illinois can provide the basis through which the discovery process can continue to help change people’s lives.

Read more from College of ACES Dean Kim Kidwell’s blog post here.


March 20, 2017

Anticipating the March 1 Soybean Stocks Estimate

USDA, at the end of this month, will let us know how much of the nation’s soybean crop there is left in the bin. It “should” be a fairly uneventful number.

by Todd Hubbs
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On March 31, the USDA will release the quarterly Grain Stocks report, with estimates of crop inventories as of March 1, and the annual Prospective Plantings report. For soybeans, the stocks estimate is typically overshadowed by the estimate of planting intentions. Usually, the quarterly stocks estimates for corn garners more interest because these reports reveal the pace of feed and residual use which is a large component of total corn consumption. The March 1 soybean stocks estimate this year may not provide much new information despite recent growth in marketing year ending stocks and concerns about the size of the South American crop… continue reading the full article by clicking here.

Generally, Todd Hubbs says it is pretty easy to figure out how many soybeans have been consumed. There is a regular reporting system for how many bushels are exported and one for how many are crushed. That second report, the crush, calculates how many soybeans are crushed in the United States into its two components. These are soybean meal and soybean oil. Hubbs, an agricultural economist at the University of Illinois, says the reports make it easy enough to calculate disappearance, consumption, usage, whatever you want to call, and consequently come up with a number that approximates how many bushels are left to use. Hubbs’ March 1 grain stocks figure for soybeans is 1.68 billion bushels. Here’s the math he used to get there.

Quote Summary - Exports for the first quarter were 932 million bushels. For the second quarter, I have them pegged at about 721 million bushels. I have the second quarter crush at 491 million bushels. This brings the total crush for the first half of the marketing year to 976 million bushels. We’ve been crushing a really good rate, but we have a lot of soybeans. So, with USDA raising ending stocks to 435 million, if that number holds and we don’t drive those numbers down, and if the March 1 stocks number is 1.68 billion, it means the last half of the marketing year we are going to have to consume about 1.23 billion bushels.

Hubbs thinks that is a reasonable number. It depends, though, he says mostly on what happens in the export market through August.



March 17, 2017

On the Value of Ethanol in the Gasoline Blend

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There has been much debate and much written about the likely costs and benefits of including ethanol in the domestic gasoline supply. Costs and benefits fall into two major categories–environmental and economic (e.g., Stock, 2015). One economic consideration is the potential impact on domestic gasoline prices from augmenting the gasoline supply with biofuels. A second economic consideration, and one that has received the most attention, is the cost of ethanol relative to petroleum-based fuel. What has been missing from the analysis of the value of ethanol in the gasoline blend is an estimate of the net value of ethanol based on: i) an energy penalty relative to gasoline; and ii) an octane premium based on the lower price of ethanol relative to petroleum sources of octane.

This farmdocDaily article provides an analysis of that net value since January 2007.


March 15, 2017

2016 Corn and Soybean Yields in Perspective


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The National Agricultural Statistical Service (NASS) recently released 2016 county yields for both corn and soybeans. In this article, maps are produced showing actual 2016 yields minus 2016 trend yields. Examination of these maps shows areas of above trend and below trend yields for 2016. Areas of above trend yields will have higher 2016 incomes relative to those areas with below trend yields.


Individual county trend yields are calculated using data from 1972 through 2016. A linear line is fit through these yields using ordinary least squares. The 2016 trend yields were based on these linearly fit relationships.

The following maps report actual minus trend yields. By calculating trend yields, the inherent productivity of the farmland is taken into consideration, and actual yields are stated relative to that productivity.






Schnitkey reports those areas with above trend yields will have relatively higher incomes than those areas with below trend yields. In 2016, lower grain farm incomes will be more pronounced in the eastern corn belt and particularly in Indiana and Ohio.


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