" I heard it through the AgLine"

April 15, 2011

 

 

·        A peak inside the world of ag investing

·        Researchers: Bat disease a major threat

·        Farmworker ‘crisis’ without labor reform

·        Honeybees making a comeback in Calif.

·        New tool removes guesswork from DNA work

 

 

A peak inside the world of ag investing

 

(The Christian Science Monitor) – Agriculture 2.0 San Francisco was a great event. So much knowledge, so many smart people...

 

Here are the points that stuck with me most on the State of Ag Investing:

 

1. The big stat that was most consistently repeated: The global population will be 9 billion by 2050.

 

2. There was a bit of a disconnect here, the sustainable farming faction bumping up against the fact that if the world went to all-organic farming overnight, half of humanity would starve to death immediately.

 

3. There are some amazing startups working on things like bio-pesticides (naturally-occurring agents to fight pests instead of chemicals) and nutrient imput technology (not all areas of a field require the same amounts of fertilizers, 2/3rds of all used fertilizer is wasted).

 

4. The water guys were here, they view water as the most unappreciated and undervalued ag commodity of all. They look at water as the software of agriculture, the land being the hardware. They point to the fact that Bill Gates couldn't convince IBM of the importance of software - water investors and owners view themselves as being overlooked in much the same way - for now.

 

5. Everyone speaks to being aware of geopolitical risk when making international farmland investments, but there are no real concrete solutions. The guy from TIAA-Cref, a huge farmland investor, acknowledged that there is a real risk of land being confiscated in a true geopolitical crisis scenario. At least the ag guys acknowledge worst-case scenario risks.

 

6. Emily French is a Rockstar. She trades both ag property and agricultural commodities and makes many appearances on CNBC. She also dropped a few curse words on stage before I had the chance to, so that helps. You'll have to watch for her, she knows her stuff.

 

7. It is very early, farmland-wise. Less than 1% of US farmland is held by investing institutions. Most importantly, there is almost no leverage in the system...so far.

 

8. The threat of China becoming a big importer of corn is very real - they're expected to buy 1.6 million tons this year and there are estimates of up to 15 million tons being imported into China by 2015. This against the backdrop of 15 year supply lows.

 

9. Aquaculture could get hot. There is a real thing called Peak Fish - the amount of ocean-caught fish is flat over the last decade. Peak Fish, who knew?

 

10. This is most important: There is an Agriculture Put according to many of the hedge fund guys here. This means that yes, ag commodities will be susceptible to a rise in interest rates in the short-term - but they must be bought furiously if and when they come down because nothing the Fed does can change the demographics and population realities. Ultimately, the improving and increasingly diverse diets of 7 billion people will trump the end of QE2 and there is one direction for consumption to go.

 

I'm glad I came out here to be a part of the conference, the most important thing I learned is how much more I still have to learn about ag, it is relentlessly fascinating and essential to understand.

 

Joshua M. Brown has been managing money for high net worth clients, charitable foundations, corporations and retirement plans for more than a decade.

 

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Researchers: Bat disease a major threat

 

(AP via Yahoo! News) CHAMPAIGN, Ill. – A group of researchers says the threat posed to bats by a fatal disease isn't just a threat to the animals but to American agriculture, one they believe farmers and consumers alike scarcely appreciate.

 

Bats save American farmers at least $3.7 billion a year in pest-control costs by eating insects that feed on crops, a benefit that could be in jeopardy as a disease that has killed more than a million bats in the Northeast spreads to the Midwest, the researchers said in a paper published in the April 1 edition of the journal Science. They and others fear the disease could eventually affect fruit- and vegetable-growing areas in the West as well.

 

"Almost daily, we get the question of why should we care about bats," said one of the paper's authors, biologist Paul Cryan of the U.S. Geological Survey. "We don't feel we have much time to get the word out that bats are important and why they're important."

 

White-nose syndrome has devastated the populations of migratory bat species such as the little brown bat in the Northeast since it was discovered in New York in 2006. Since then, the fungus that causes the disease has spread south and west to 16 states and parts of Canada. More than a million bats have died, according to the U.S. Fish & Wildlife Service.

 

But agriculture is a much smaller business in northeastern states like New York than it is in the Midwest. Just last month the disease was found in Ohio, one of the country's larger producers of corn and soybeans. It's also recently turned up in Indiana — another big corn and soybean state — while suspected cases have been reported in Missouri. White-nose syndrome also has been found this year in North Carolina, a big Southern farm state.

 

Some West Coast farmers and organic growers have talked for years about the effectiveness of bats as a means of pest control.

 

Cryan and the other researchers set out several years ago to measure that benefit, a task they and others say is very difficult. They began by looking at what bugs bats ate in the cotton-growing areas of south-central Texas. They were particularly interested in whether bats ate cotton boll worms, and they found they did — a lot of them. In all, each bat ate up to 8 grams (about the weight of two grapes) of bugs each night.

 

Earlier research the Science paper draws on indicates bats in the Midwest eat a range of pests — stink bugs, root worm moths and many others.

 

Using the consumption rate they found in Texas, the authors figured bats save farmers anywhere from $12 to $173 an acre a year in pesticide costs, depending on the crops they grow, pesticides they use and other factors.

 

The researchers consider their $3.7 billion estimate conservative, but they expect some skepticism.

 

"We expect there to be some people to disagree with the details of this, and we hope that that starts a broader scientific discourse," Cryan said.

 

He and his research partners also noted that, to a lesser extent, they're concerned about bats being killed by electricity generating wind turbines, particularly since the windy, flat Midwest has many.

 

Phil Nixon, an entomologist at the University of Illinois, works with corn and soybean farmers on crop protection and shares the authors' concerns about bats and white-nose syndrome. He just isn't sure bats could eat enough to cut down much on the many pests found in the millions of acres of corn, soybeans and wheat across the Midwest.

 

"I'm sure all of these would be impacted by bat feeding, but how much it is it's hard to say," Nixon said. "My guess is relatively small."

 

But bats are already playing a significant role in pest reduction in some Western crops.

 

University of California Extension Service entomologist Rachael Freeman Long works with numerous central California farmers who grow crops like walnuts and hang bat houses to attract and keep the mammals.

 

"Farmers love their bats in this area," Long said. "When you go onto the farm level and you talk to farmers, their idea is every pest that a bat eats is one less that they don't have to take care of."

 

Bob Borchard is one of those farmers. He says he and his bother Joseph have about 20 bat houses scattered over their 400 acres of walnut trees near Winters, Calif., primarily to get rid of a common pest called the coddling moth.

 

"They do a really good job," he said, explaining that bats take care of most of the brothers' pest-control needs. "It's about 80 percent."

 

No one knows how quickly white-nose syndrome could spread across the Midwest, Cryan and fellow bat-paper author Gary McCracken said, or whether it will eventually reach the West. But they worry that because the disease has moved quickly so far that it could drastically reduce bat populations in just four or five years — and force farmers to spray far more pesticides than they now do.

 

Until now, "It's not really been in the bread basket, so to speak," said Gary McCracken, a University of Tennessee professor of ecology and evolutionary biology.

 

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Farmworker ‘crisis’ without labor reform

 

Washington (CNN) -- The agricultural industry in the United States could face a crisis if the country doesn't find a way to attract more legal farm workers from abroad soon. That's one of the conclusions reached this week at a congressional hearing.

 

The House Subcommittee on Immigration Policy and Enforcement met to evaluate a migrant farm-worker visa program frequently used by Mexicans to legally work on farms and ranches across the United States. The H-2A visa program was created for that purpose back in the late 1980s.

 

Rep. Elton Gallegly, R-California, in his opening remarks as chairman of the subcommittee, said, "There are simply not enough Americans willing to do, to take the jobs of migrant farm workers. In fact, our government's policy for generations has been to remove Americans from such labor."

 

The lack of American farm workers and the labor needs of the agricultural industry coupled with low wages in Mexico create a situation in which the demand attracts many Mexican workers who enter the United States legally or otherwise.

 

According to the U.S. Department of Labor's National Agricultural Workers Survey, which canvasses hired farm workers, over the period of 2007 to 2009, 48% of farm workers in the country admitted they were in the United States illegally.

 

The agricultural industry has repeatedly asked the federal government to streamline and expedite the H-2A visa program as its labor needs have grown over the years.

 

Lee Wicker, deputy director of the North Carolina Growers Association -- an organization with 600 grower members and the largest H-2A program user in the country -- said the current program is ineffective. Wicker called it "costly, time-consuming, and flawed. Farmers have to complete a lengthy labor certification process that's slow, bureaucratic, and frustrating."

 

Immigration remains a political hot-button issue in the country. Far from finding a way to legalize farm workers already in the country, many legislators at the federal and local levels are calling for stronger enforcement of the current immigration laws.

Rep. Steve King, R-Iowa, said the argument that the country doesn't have enough farm workers and therefore has to import them is flawed. "I'm thinking about a nation that has a lot of people that are riding along on this boat and not pulling on the oars. Wouldn't a logical nation want to employ all of those that are eligible to work before they would bring people in, especially given that we have 71 welfare programs?" said King.

 

But Rep. Zoe Lofgren, D-California, the subcommittee's ranking member, said Wednesday at the hearing that a hard approach, including deportations, wouldn't solve the problem.

 

"If we somehow deported the 1 (million) to 1.5 million undocumented workers on our farms and ranches right now, there are too few Americans jumping at the change to fill those jobs, and I suspect that's why we're having this hearing," Lofgren said.

 

Agricultural states like California and Florida would greatly benefit from an expedited visa program for farm workers. But Rep. Dan Lungren, D-California, says the appetite for such measures in the U.S. Congress is just not there.

 

"I doubt anybody running for president, including the incumbent, is going to run on the fact that he's going to be softer on immigration enforcement that he has been," Lungren said.

 

He went further, saying that if no action is taken, "we're going to have... a crisis in agriculture."

 

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Honeybees making a comeback in Calif.

 

(SFGate.com) – After tumbling to a 23-year low in 2007, California's commercial honeybee population seems to be on the rebound - though a mysterious and deadly epidemic persists in ravaging some colonies.

 

Apiarists in the state, most of whom rent their bees to farmers for crop pollination, say this and last year's wet winters - and more plentiful greenery - may have helped temper the effects of "colony collapse disorder," a little-understood scourge that has virtually wiped out some bee stocks across California and the United States.

 

But other beekeepers say they've simply gotten better at compensating for the die-off by dividing their colonies, importing new queen bees or buying whole colonies outright (the number of bees in a commercial colony fluctuates through the year, ranging between about 20,000 and 150,000).

 

"We're learning new ways to deal with (colony collapse disorder), so the numbers are getting better," said Frank Pendell, president of the California State Beekeepers Association. "It's just like hitting your finger over and over with a hammer. You learn to stop doing it."

 

The number of honeybee colonies in California is at its highest level in seven years - good news in a state where the black-and-yellow bug represents a critical link in the multibillion-dollar food-production cycle. In their search for nectar, the buzzing insects unwittingly distribute pollen - the equivalent of male sperm - to the female part of plants. Nearly 100 California crops, including melons, sunflowers, carrots, cauliflower and almonds, rely on bee pollination.

 

The National Agricultural Statistics Service, one of the only state or federal agencies that track honeybees, counted 410,000 colonies in California last year, up from 355,000 in 2009 and a rock-bottom 340,000 in 2007.

 

Count considered low

In general, the national data under-represent the number of colonies because the annual survey is voluntary and does not include operations that strictly rent their bees for pollination; most industry watchers put the number of California colonies at 500,000 to 550,000.

 

That remains well below the recent peak of 620,000 colonies in 1989 (the records go back to 1987). Nevertheless, honeybee experts are heartened by what they see as marked improvement in the health of many hives - particularly after the 2007 nadir.

 

One factor may be Mother Nature. More rain in 2010 and 2011 may have boosted the bees' floral food supply, and lower summer temperatures may reduce heat-related stressors, according to Eric Mussen, a well-known bee authority at UC Davis.

 

"On the whole it looks like the bees are doing better," Mussen said. "With a little luck, this may be one of our better years."

 

Cyclical die-offs

The loss of 15 to 25 percent of a colony's bees over a winter is pretty normal, Mussen said. And over the history of apiculture - European honeybees were brought to the United States in the 1600s - mass deaths are not unheard of. Wild bee populations have plunged in recent years due to loss of habitat, and commercially raised bees have succumbed to cyclical die-offs due to a host of diseases and microbes.

 

Colony collapse disorder - first described in 2006 by a Pennsylvania beekeeper who lost most of his bees after trucking his hives to Florida for the winter - is striking in its devastation. The sickness seems to target the insect's gut, interfering with its ability to take in nutrients. While the disorder culls an average of one-third of each colony's bees in California and the United States, in some cases up to 90 percent of the workers simply fly off and die. Scientists are still struggling to find the culprit - or culprits.

 

Recent research suggests several causes working in tandem, including dry weather, poor food sources, environmental stress, insecticides, fungi, mites and viruses. Some have even blamed genetically modified crops and cell phone radiation.

 

Almonds need bees

While scientists continue to narrow the suspects, farmers are keeping a close eye on the bees' fortunes. No product has more at stake than the state's $2 billion annual almond crop.

 

Each year, the almond bloom in the Central Valley requires about 1.5 million honeybee colonies for pollination, or about half of all the commercial colonies in the United States. Beekeepers charged between $140 and $165 per hive this almond season, Pendell said; one acre typically requires two hives for pollination.

 

Tom Parisian, who tends 3,500 colonies in Vacaville, has changed the way he rents bees to almond farmers after colony collapse disorder claimed about half of his bees in 2008.

 

For instance, some growers use pesticides that experts have implicated in the bee plague. On days when farmers spray those chemicals, Parisian removes his hives. It's expensive and time-consuming, Parisian said, but if the tactic helps keep his bees healthy, he's willing to take the hit.

 

Parisian also supplements his bees' diet with syrup to boost protein levels and treats the colonies with anti-viral medicine.

 

"You can't tell which one or two things may be having an effect," he said. "But the bottom line is the bees came through last winter in better shape - probably better than they have been in 30 years."

 

Still, no cure for the disorder exists, and Mussen continues to hear from beekeepers who lose half of a colony seemingly overnight.

 

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New tool removes guesswork from DNA work

 

(Iowa State University) AMES, Iowa — An improved molecular tool for precisely modifying DNA in living cells could allow researchers to better introduce genes for disease resistance in crops or develop safer gene therapies to treat human diseases.

 

Technology co-developed by researchers at Iowa State University and the University of Minnesota now makes these kinds of advances possible. The technology, called TAL effector nucleases, removes the guesswork from DNA targeting, allowing researchers to make modifications at virtually any place in a genome.

 

A Paris-based biotechnology company, Cellectis, recently signed an exclusive license agreement with University of Minnesota and Iowa State granting the company worldwide rights to use and market TAL effector nucleases. Scientists at Minnesota and Iowa State have a patent pending on the technology.

 

“TAL effector nucleases are like scissors that find and cut specific DNA sequences,” said Adam Bogdanove, associate professor in plant pathology, and co-inventor. “We can build these scissors to recognize any DNA sequence we want, allowing us to target very specifically.”

 

Bodganove said this specificity is important because most of the genome engineering techniques scientists have relied on to date — to introduce a new gene into a crop, for instance, or mutate a gene to study its function — have been random with respect to where the mutation takes place or the new gene goes in the genome. TAL effector nucleases, however, remove this randomness.

 

“This new tool for genome engineering could impact agriculture and human health in pretty astounding ways,” he said. “Precise targeting could drastically reduce the time needed to develop a transgenic crop with improved traits, and would remove the potential for unexpected changes in the genome due to random insertion of a transgene.”

 

For human health, Bogdanove said an important application is in cell therapy to treat genetic disorders, where better targeting would allow correction of defects in a patient’s own stem cells.

 

“That would make it unnecessary to use cells from a donor, which might be rejected by the patient’s immune system,” he said.

 

Earlier research by Bogdanove helped pave the way for these advances. TAL effectors are a class of proteins that pathogenic bacteria inject into plant cells, where they attach to the host’s DNA at specific locations and turn on genes within the plant that allow infection to take place.

 

Seeking to understand how these proteins find their targets, Bogdanove stumbled on what turned out to be a clear-cut coding mechanism that matches amino acid pairs in the protein with individual units in the DNA.

 

“It was like the holy grail for genome engineers,” Bogdanove said. “So I contacted an expert in the area and asked if he wanted to work together.”

 

That expert was Dan Voytas, a former Iowa State professor who’s now director of the Center for Genome Engineering at the University of Minnesota.

 

In 2010, Bogdanove and Voytas published a paper in the journal “Genetics” describing their discovery that TAL effector proteins, which bind DNA, could be hooked to a nuclease, which cleaves it — yielding the precise scissors that are needed for genome editing.

 

A manuscript showing similar results was published at almost the same time by another Iowa State researcher, Bing Yang, and colleagues. Yang is assistant professor of genetics development and cell biology at Iowa State and had also been studying TAL effectors. A number of other labs have since adopted the technology.

 

Bogdanove said that genome engineering with existing tools had been frustrated by the difficulty of consistently designing proteins with the specificities required to target sequences of interest.

 

“With TAL effectors, however, the parts of the protein that specify bases in the DNA are modular, so there’s no guesswork,” Bogdanove said. “We can move them around and create TAL effectors or TAL effector nucleases that target whatever DNA sequence we need to.”

 

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