RP94-217 No. 18 Use of Crop Futures and Options by the Nontrader

Crop producers make a number of decisions that are market related. They may be categorized as financial decisions, production decisions, or marketing decisions. All three decisions depend on what prices are likely to be at some specific time in the future. The marketing decisions is complex. This research publication discusses the number of alternatives that are available even for the producer who does not directly buy or sell futures or options contracts.

Delineation of specific management areas for coffee cultivation based on the soil-relief relationship and numerical classification

Predicting and mapping productivity areas allows crop producers to improve their planning of agricultural activities. The primary aims of this work were the identification and mapping of specific management areas allowing coffee bean quality to be predicted from soil attributes and their relationships to relief. The study area was located in the Southeast of the Minas Gerais state, Brazil. A grid containing a total of 145 uniformly spaced nodes 50 m apart was established over an area of 31. 7 ha from which samples were collected at depths of 0. 00-0. 20 m in order to determine physical and chemical attributes of the soil. These data were analysed in conjunction with plant attributes including production, proportion of beans retained by different sieves and drink quality. The results of principal component analysis (PCA) in combination with geostatistical data showed the attributes clay content and available iron to be the best choices for identifying four crop production environments. Environment A, which exhibited high clay and available iron contents, and low pH and base saturation, was that providing the highest yield (30. 4l ha-1) and best coffee beverage quality (61 sacks ha-1). Based on the results, we believe that multivariate analysis, geostatistics and the soil-relief relationships contained in the digital elevation model (DEM) can be effectively used in combination for the hybrid mapping of areas of varying suitability for coffee production. © 2012 Springer Science+Business Media New York.

Optimism of Rural Nebraskans

Results from the 2008 Nebraska Rural Poll showed rural Nebraskans were more optimistic about their lives than they have been in previous years. More Nebraskans believed they were better off than they were five years ago, and more were optimistic about their futures. They had reason to be optimistic last year, the agricultural economy in 2007 was strong, especially for crop producers. The poll was taken between March and May, 2008, before the national economy began to falter in October. Thus the 2009 Nebraska Rural Poll will help clarify how rural Nebraskans are responding to the current economic times.

Assessing Needs for Computer Pest Management Software in Nebraska Agriculture

A mail survey was conducted to assess current computer hardware use and perceived needs of potential users for software related to crop pest management in Nebraska. Surveys were sent to University of Nebraska-Lincoln agricultural extension agents, agribusiness personnel (including independent crop consultants), and crop producers identified by extension agents as computer users. There were no differences between the groups in several aspects of computer hardware use (percentage computer use, percentage IBM-compatible computer, amount of RAM memory, percentage with hard drive, hard drive size, or monitor graphics capability). Responses were similar among the three groups in several areas that are important to crop pest management (pest identification, pest biology, treatment decision making, control options, and pesticide selection), and a majority of each group expressed the need for additional sources of such information about insects, diseases, and weeds. However, agents mentioned vertebrate pest management information as a need more often than the other two groups. Also, majorities of each group expressed an interest in using computer software, if available, to obtain information in these areas. Appropriate software to address these needs should find an audience among all three groups.

Shifting cultivation stability and change: Contrasting pathways of land use and livelihood change in Laos

Rural areas in Laos are experiencing a rapid transformation from traditional rice-based shifting cultivation systems to more permanent and diversified market-oriented cultivation systems. The consequences of these changes for local livelihoods are not well known. This study analyzes the impact of shifting cultivation change on the livelihood of rural people in six villages in three districts of northern and central Laos. Focus group discussions and household interview questionnaires were employed for data collection. The study reveals that the shifting cultivation of rice is still important in these communities, but it is being intensified as cash crops are introduced. Changes in shifting cultivation during the past ten years vary greatly between the communities studied. In the northern study sites, it is decreasing in areas with rubber expansion and increasing in areas with maize expansion, while it is stable in the central site, where sugarcane is an important cash crop. The impacts of land use change on livelihoods are also diverse. Cash crop producers hold more agricultural land than non-cash crop producers, and rubber and sugarcane producers have fewer rice shortages than non-producers. In the future, livelihood improvements in the central study site may be replicated in the northern sites, but this depends to a large extent on the economic and agricultural settings into which cash crops and other development opportunities are introduced. Moreover, the expansion of cash crops appears to counteract Lao policies aimed at replacing shifting cultivation areas with forests.

Increasing profits and reducing risks in crop production using participatory systems simulation approaches

The development of cropping systems simulation capabilities world-wide combined with easy access to powerful computing has resulted in a plethora of agricultural models and consequently, model applications. Nonetheless, the scientific credibility of such applications and their relevance to farming practice is still being questioned. Our objective in this paper is to highlight some of the model applications from which benefits for farmers were or could be obtained via changed agricultural practice or policy. Changed on-farm practice due to the direct contribution of modelling, while keenly sought after, may in some cases be less achievable than a contribution via agricultural policies. This paper is intended to give some guidance for future model applications. It is not a comprehensive review of model applications, nor is it intended to discuss modelling in the context of social science or extension policy. Rather, we take snapshots around the globe to 'take stock' and to demonstrate that well-defined financial and environmental benefits can be obtained on-farm from the use of models. We highlight the importance of 'relevance' and hence the importance of true partnerships between all stakeholders (farmer, scientists, advisers) for the successful development and adoption of simulation approaches. Specifically, we address some key points that are essential for successful model applications such as: (1) issues to be addressed must be neither trivial nor obvious; (2) a modelling approach must reduce complexity rather than proliferate choices in order to aid the decision-making process (3) the cropping systems must be sufficiently flexible to allow management interventions based on insights gained from models. The pro and cons of normative approaches (e.g. decision support software that can reach a wide audience quickly but are often poorly contextualized for any individual client) versus model applications within the context of an individual client's situation will also be discussed. We suggest that a tandem approach is necessary whereby the latter is used in the early stages of model application for confidence building amongst client groups. This paper focuses on five specific regions that differ fundamentally in terms of environment and socio-economic structure and hence in their requirements for successful model applications. Specifically, we will give examples from Australia and South America (high climatic variability, large areas, low input, technologically advanced); Africa (high climatic variability, small areas, low input, subsistence agriculture); India (high climatic variability, small areas, medium level inputs, technologically progressing; and Europe (relatively low climatic variability, small areas, high input, technologically advanced). The contrast between Australia and Europe will further demonstrate how successful model applications are strongly influenced by the policy framework within which producers operate. We suggest that this might eventually lead to better adoption of fully integrated systems approaches and result in the development of resilient farming systems that are in tune with current climatic conditions and are adaptable to biophysical and socioeconomic variability and change. (C) 2001 Elsevier Science Ltd. All rights reserved.

An Analysis of the Link between Ethanol, Energy, and Crop Markets, November 2006

This study analyzes the impact of price shocks in three input and output markets critical to ethanol: gasoline, corn, and sugar. We investigate the impact of these shocks on ethanol and related agricultural markets in the United States and Brazil. We find that the composition of a country’s vehicle fleet determines the direction of the response of ethanol consumption to changes in the gasoline price. We also find that a change in feedstock costs affects the profitability of ethanol producers and the domestic ethanol price. In Brazil, where two commodities compete for sugarcane, changes in the sugar market affect the competing ethanol market.

Get a GRIP: Should Area Revenue Coverage Be Offered through the Farm Bill or as a Crop Insurance Program? 2007

The successful expansion of the U.S. crop insurance program has not eliminated ad hoc disaster assistance. An alternative currently being explored by members of Congress and others in preparation of the 2007 farm bill is to simply remove the “ad hoc” part of disaster assistance programs by creating a standing program that would automatically funnel aid to hard-hit regions and crops. One form such a program could take can be found in the area yield and area revenue insurance programs currently offered by the U.S. crop insurance program. The Group Risk Plan (GRP) and Group Risk Income Protection (GRIP) programs automatically trigger payments when county yields or revenues, respectively, fall below a producer-elected coverage level. The per-acre taxpayer costs of offering GRIP in Indiana, Illinois, and Iowa for corn and soybeans through the crop insurance program are estimated. These results are used to determine the amount of area revenue coverage that could be offered to farmers as part of a standing farm bill disaster program. Approximately 55% of taxpayer support for GRIP flows to the crop insurance industry. A significant portion of this support comes in the form of net underwriting gains. The expected rate of return on money put at risk by private crop insurance companies under the current Standard Reinsurance Agreement is approximately 100%. Taking this industry support and adding in the taxpayer support for GRIP that flows to producers would fund a county target revenue program at the 93% coverage level.

Nitrogen fixation by groundnut and velvet bean and residual benefit to a subsequent maize crop

Chemical fertilisers are rarely avaiable to poor farmers, for whom the nitrogen (N) is often the most limiting element for cereal grain production. The objective of this study was to quantify the contribution of biological nitrogen fixation (BNF) to groundnut (Arachis hypogaea) and velvet bean (Mucuna pruriens) crops using the 15N natural abundance (delta15N) technique and to determine their residual effect and that of a natural fallow, on growth and N accumulation by two rustic maize varieties. The contribution of BNF calculated from delta15N data was 40.9, 59.6 and 30.9 kg ha-1, for groundnut, velvet bean and the natural fallow, respectively. The only legume grain harvested was from the groundnut, which yielded approximately 1.000 kg ha-1. The subsequent maize varieties ("Sol de Manhã" and "Caiana Sobralha") yielded between 1.958 and 2.971 kg ha-1, and were higher after velvet bean for both maize varieties and "Sol da Manhã" groundnut, followed by "Caiana" after groundnut and, finally, the natural fallow. For a small-holder producer the most attractive system is the groundnut followed by maize, as, in this treatment, both groundnut and maize grain harvest are possible. However, a simple N balance calculation indicated that the groundnut-maize sequence would, in the long term, deplete soil N reserves, while the velvet bean-maize sequence would lead to a build up of soil nitrogen.

Spatial autocorrelation of ndvi and gvi indices derived from landsat/tm images for soybean crops in the western of the state of Paraná in 2004/2005 crop season

This research aims at studying spatial autocorrelation of Landsat/TM based on normalized difference vegetation index (NDVI) and green vegetation index (GVI) of soybean of the western region of the State of Paraná. The images were collected during the 2004/2005 crop season. The data were grouped into five vegetation index classes of equal amplitude, to create a temporal map of soybean within the crop cycle. Moran I and Local Indicators of Spatial Autocorrelation (LISA) indices were applied to study the spatial correlation at the global and local levels, respectively. According to these indices, it was possible to understand the municipality-based profiles of tillage as well as to identify different sowing periods, providing important information to producers who use soybean yield data in their planning.

Horizontal nutrient fluxes and production efficiencies in urban and peri-urban crop and livestock husbandry of Niamey, Niger

Urban and peri-urban agriculture (UPA) increasingly supplies food and non-food values to the rapidly growing West African cities. However, little is known about the resource use efficiencies in West African small-scale UPA crop and livestock production systems, and about the benefits that urban producers and retailers obtain from the cultivation and sale of UPA products. To contribute to filling this gap of knowledge, the studies comprising this doctoral thesis determined nutrient use efficiencies in representative urban crop and livestock production system in Niamey, Niger, and investigated potential health risks for consumers. Also assessed was the economic efficiency of urban farming activities. The field study, which was conducted during November 2005 to January 2008, quantified management-related horizontal nutrient flows in 10 vegetable gardens, 9 millet fields and 13 cattle and small ruminant production units. These farms, selected on the basis of a preceding study, represented the diversity of UPA crop and livestock production systems in Niamey. Based on the management intensity, the market orientation and especially the nutrient input to individual gardens and fields, these were categorized as high or low input systems. In the livestock study, high and low input cattle and small ruminant units were differentiated based on the amounts of total feed dry matter offered daily to the animals at the homestead. Additionally, economic returns to gardeners and market retailers cultivating and selling amaranth, lettuce, cabbage and tomato - four highly appreciated vegetables in Niamey were determined during a 6-months survey in forty gardens and five markets. For vegetable gardens and millet fields, significant differences in partial horizontal nutrient balances were determined for both management intensities. Per hectare, average annual partial balances for carbon (C), nitrogen (N), phosphorus (P) and potassium (K) amounted to 9936 kg C, 1133 kg N, 223 kg P and 312 kg K in high input vegetable gardens as opposed to 9580 kg C, 290 kg N, 125 kg P and 351 kg K in low input gardens. These surpluses were mainly explained by heavy use of mineral fertilizers and animal manure to which irrigation with nutrient rich wastewater added. In high input millet fields, annual surpluses of 259 kg C ha-1, 126 kg N ha-1, 20 kg P ha-1 and 0.4 kg K ha-1 were determined. Surpluses of 12 kg C ha-1, 17 kg N ha-1, and deficits of -3 kg P ha-1 and -3 kg K ha-1 were determined for low input millet fields. Here, carbon and nutrient inputs predominantly originated from livestock manure application through corralling of sheep, goats and cattle. In the livestock enterprises, N, P and K supplied by forages offered at the farm exceeded the animals’ requirements for maintenance and growth in high and low input sheep/goat as well as cattle units. The highest average growth rate determined in high input sheep/goat units was 104 g d-1 during the cool dry season, while a maximum average gain of 70 g d-1 was determined for low input sheep/goat units during the hot dry season. In low as well as in high input cattle units, animals lost weight during the hot dry season, and gained weight during the cool dry season. In all livestock units, conversion efficiencies for feeds offered at the homestead were rather poor, ranging from 13 to 42 kg dry matter (DM) per kg live weight gain (LWG) in cattle and from 16 to 43 kg DM kg-1 LWG in sheep/goats, pointing to a substantial waste of feeds and nutrients. The economic assessment of the production of four high value vegetables pointed to a low efficiency of N and P use in amaranth and lettuce production, causing low economic returns for these crops compared to tomato and cabbage to which inexpensive animal manure was applied. The net profit of market retailers depended on the type of vegetable marketed. In addition it depended on marketplace for amaranth and lettuce, and on season and marketplace for cabbage and tomato. Analysis of faecal pathogens in lettuce irrigated with river water and fertilized with animal manure indicated a substantial contamination by Salmonella spp. with 7.2 x 104 colony forming units (CFU) per 25 g of produce fresh matter, while counts of Escherichia coli averaged 3.9 x 104 CFU g-1. In lettuce irrigated with wastewater, Salmonella counts averaged 9.8 x 104 CFU 25 g-1 and E. coli counts were 0.6 x 104 CFU g-1; these values exceeded the tolerable contamination levels in vegetables of 10 CFU g-1 for E. coli and of 0 CFU 25 g-1 for Salmonella. Taken together, the results of this study indicate that Niamey’s UPA enterprises put environmental safety at risk since excess inputs of N, P and K to crop and livestock production units favour N volatilisation and groundwater pollution by nutrient leaching. However, more detailed studies are needed to corroborate these indications. Farmers’ revenues could be significantly increased if nutrient use efficiency in the different production (sub)systems was improved by better matching nutrient supply through fertilizers and feeds with the actual nutrient demands of plants and animals.

Why Bt cotton pays for small-scale producers in South Africa

There is much debate about the potential benefits (and costs) of genetically modified (GM) crop technology for developing countries. Studies have been carried out in Argentina, China, Indonesia and most recently India1 to assess the impact of Bacillus thuringiensis (Bt) cotton on farmers in those regions.

Bt-cotton boosts the gross margin of small-scale cotton producers in South Africa

This paper explores some of the issues involved in the Genetic Modification (GM) debate by focusing on one crop that has been modified for pest resistance, cotton (Gossypium hirsutum), and commercially released to small-scale farmers in the Makhathini Flats, KwaZulu Natal, the Republic of South Africa. This was the first commercial release of a GM variety (Bt-cotton) in Sub-Saharan Africa, and thus provides valuable and timely insights into some of the potential advantages and disadvantages of the technology for small-scale farmers in Africa. Even though there are wider concerns regarding the vulnerability of small-scale farmers in the area, the survey results suggest that Bt-cotton generated higher yields and gross margins than non-Bt-cotton. In addition, Bt-cotton significantly reduced the use of pesticide with consequent potential benefits to human health and the environment.

The role of weeds in supporting biological diversity within crop fields

Weeds are major constraints on crop production, yet as part of the primary producers within farming systems, they may be important components of the agroecosystem. Using published literature, the role of weeds in arable systems for other above-ground trophic levels are examined. In the UK, there is evidence that weed flora have changed over the past century, with some species declining in abundance, whereas others have increased. There is also some evidence for a decline in the size of arable weed seedbanks. Some of these changes reflect improved agricultural efficiency, changes to more winter-sown crops in arable rotations and the use of more broad-spectrum herbicide combinations. Interrogation of a database of records of phytophagous insects associated with plant species in the UK reveals that many arable weed species support a high diversity of insect species. Reductions in abundances of host plants may affect associated insects and other taxa. A number of insect groups and farmland birds have shown marked population declines over the past 30 years. Correlational studies indicate that many of these declines are associated with changes in agricultural practices. Certainly reductions in food availability in winter and for nestling birds in spring are implicated in the declines of several bird species, notably the grey partridge, Perdix perdix . Thus weeds have a role within agroecosystems in supporting biodiversity more generally. An understanding of weed competitivity and the importance of weeds for insects and birds may allow the identification of the most important weed species. This may form the first step in balancing the needs for weed control with the requirements for biodiversity and more sustainable production methods.

Sugars in crop plants

We review current knowledge of the most abundant sugars, sucrose, maltose, glucose and fructose, in the world's major crop plants. The sucrose-accumulating crops, sugar beet and sugar cane, are included, but the main focus of the review is potato and the major cereal crops. The production of sucrose in photosynthesis and the inter-relationships of sucrose, glucose, fructose and other metabolites in primary carbon metabolism are described, as well as the synthesis of starch, fructan and cell wall polysaccharides and the breakdown of starch to produce maltose. The importance of sugars as hormone-like signalling molecules is discussed, including the role of another sugar, trehalose, and the trehalose biosynthetic pathway. The Maillard reaction, which occurs between reducing sugars and amino acids during thermal processing, is described because of its importance for colour and flavour in cooked foods. This reaction also leads to the formation of potentially harmful compounds, such as acrylamide, and is attracting increasing attention as food producers and regulators seek to reduce the levels of acrylamide in cooked food. Genetic and environmental factors affecting sugar concentrations are described.