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May 18, 2011
· Deere poised to reap profits from farm boom
· Labor shortage hinders Florida small growers
· World’s largest carrot grower turns on the sun
· Geneticists strive to build a better honeybee
· Farming on water: Stackable and sustainable
Deere poised to reap profits from farm boom
Rentschler, who escaped the East
Coast for rural
Rentschler knows well that wealthy growers are good for the businesses of ag giants like Deere. As the maker of the iconic green machines gets ready to report fiscal second-quarter results before Wednesday's opening bell, he also knows that Deere will continue on the upswing it's experienced (along with the rest of the agriculture industry) since a series of weather-related supply shocks last year sparked a boom in farm commodities that has caused food-price inflation all over the world (and, indirectly, political uprisings in the Middle East).
Meanwhile, the boom has driven Deere shares, which trade in
tandem with crop prices on the commodities markets, to all-time heights. Before
a pullback in commodities that started at the beginning of May, shares of the
According to the consensus estimate of
Renstchler thinks estimates for Deere -- both for the second quarter and for all of 2011 -- remain low. The Wall Street consensus target for Deere's fiscal 2011 calls for EPS of $6.23. "This company is typically conservative," Rentschler said in an interview. "And I guess I'd be looking for any signs of them saying that business is better than they expected." For him, a solid beat by Deere in the second quarter -- much like the first -- wouldn't amount to much of a surprise.
Other analysts are equally bullish, but they point nevertheless to a few uncertainties. Chief among them is (as usual for agriculture) the weather, with heavy rains and massive Mississippi flooding in the heart of the Midwestern corn belt that has kept soils too moist to plant, delaying the growing season and possibly hurting crop output this year. (Though farmers seem to have closed the gap of late, according to the latest reports on Agriculture.com.)
Whether this is good or bad for farmers is a tricky question, and one that will affect the likes of Deere only in 2012. It also depends on how severe any shortfall in crop output might be. "Farmers might be hurt if they can't produce a given amount of the commodity," said Michael Jaffe, an analyst who covers Deere for Standard & Poor's. "I'd like to hear from management how confident they are in their business remaining strong given what's been going on lately," he said.
Others are more sanguine. Any decline in output and yields wouldn't likely be enough to offset the consequent rise in prices that such supply constraints would cause in the commodities markets, the bulls say.
Charlie Rentschler noted that
professional crop watchers at
Still, said Renstchler, "Those shortfalls in yield are typically made up for by an increase in revenues. I think it's bullish overall for farmers."
If it holds, those same trends will continue to drive the earnings growth and share values of companies across the agrarian industries, from fertilizer producers like CF Industries and Potash(POT), to farm-gear retailers like Agrium(AGU), to the ag commodities middleman Archer Daniels Midland(ADM).
All of those stocks reached all-time highs earlier this year.
Though much is made by these companies during their investor roadshows about the long-term trends of population growth and the inevitable rise of food demand, the simple truth remains: Deere and these other ag names trade in sync with ag commodities prices -- and thus the weather.
When it comes to Deere, Rentschler's biggest concern is a longer term one. "The thing I would wonder: Does there come a point when Deere has satisfied demand for large equipment? It's not typical you buy a new tractor every year. Some guys do. But most hold out till the end of the warranty, and then flip it." Though farmers are as flush as they've ever been, he added, "buying sprees don't last forever."
Meanwhile, Deere's construction-gear, though a far smaller segment and dwarfed by rivals like Caterpillar(CAT), stands to benefit from any uptick in that still-downtrodden sector.
Labor shortage hinders Florida
(Bradenton.com)
DUETTE -- Felicia Tappan of
Initially, she was only able to find a crew of six to
harvest the berries on her Vintage Organic Acres farm at
“It’s real intense work, even though it’s only 3 1/2 acres,” Tappan said.
Pickers have to be able to sort by color and size, and the berries are picked one at a time below waist level.
In the quest for farm labor, her foreman went door to door in Wimauma, while Tappan beat the bushes in Duette, checking Social Security cards and photo IDs to come up with 40 legal workers.
She was able to avert having to throw her field open to U-pickers to keep the prized berries from going to waste.
It’s not a problem unique to Vintage Organic Acres.
Hunsader Farms in East Manatee had to open its fields to the public because there weren’t enough workers to do the back-breaking work.
“Last year we did this because the price for a 25-pound bucket of tomatoes on the wholesale market was only three or four dollars so it didn’t make economic sense to pick,” co-owner David Hunsader previously told the Bradenton Herald. “This year the price is good, about $14 for a bucket, but we can’t find enough labor to pick them.”
Tappan, Hunsader, and other
growers understand the problem with undocumented workers in the
“It’s a hot topic, but we were all immigrants at one time,” Tappan said. “As farmers we shouldn’t have to plant our crops around these kind of issues. We’re feeding the world.”
Tappan and her husband, Wade, have lived in Duette since 1987, and know full well the challenges of farming, even when labor is plentiful.
The Tappans planted their first blueberries in 2007 on former orange grove land. They plowed under the diseased orange trees and started over, planting the blueberries in 40 semi-tractor loads of pine bark.
They had also operated a tree farm on the property for 20 years, but that business went into a tailspin after the disastrous hurricanes of 2004 and 2005, and a collapse of the market.
“It got to the point that it wasn’t worth taking the equipment out,” Felicia Tappan said.
Due to the riskiness of the business, Wade Tappan has a job
off the farm. He works at Mote Marine’s aquaculture project in eastern
Each year, however, the maturing blueberry bushes improve their yield and at the height of the season, pickers were collecting 1,200 pounds of berries three times a week.
“Next year, we expect to double that,” Tappan said.For the next two weeks, she will allow U-pickers into her field, but she says call first at (941) 920-1801 before making the long drive.
Neighbor Betty Stewart said she is impressed with how hard Felicia Tappan works and how she keeps reinventing herself.
“We have seen her working on her tractor and whatever else needs to be done. She’s not afraid to tackle anything,” Stewart said.
World’s largest carrot grower turns on the sun
(CVBT) Grimmway Enterprises Inc., which says it is the largest carrot grower in the world, is making its carrots green.
It has turned on a 230-kilowatt ground-mounted solar power
system, featuring more than 1,000 solar modules, on one of its carrot farms
near Arvin in the
The system was designed by Conergy
USA Inc., a unit of Conergy AG of
Conergy says the installation will prevent the release of around 150,000 pounds of carbon dioxide per year, reduce energy consumption by 40 percent and reduce the electric bill by 50 percent.
“We are very happy to support the green path of Grimmway Enterprises,” says Conergy Project Development Manager David Vincent.
Geneticists strive to build a better honeybee
(Nature.com) – For Scott Cornman, the honeybee genome is a prized resource, yet he spends much of his time removing it. Cornman, a geneticist for the Bee Research Laboratory of the US Department of Agriculture (USDA) in Beltsville, Maryland, is trying to characterize the various pathogens that plague the honeybee (Apis mellifera), arguably the world's most important insect.
His strategy is to subtract the honeybee genome from every other stray bit of genetic residue he can find in bee colonies, healthy and diseased. The remaining genetic material gives a complex metagenomic portrait of other organisms that inhabit the bee's world, including viruses, bacteria and fungi — some novel — that, alone or in combination, might push a bee colony into precipitous decline.
"Right now we're in the discovery phase, where we're trying to identify what's present," says Cornman. "Then we can start looking at the interactions of pathogens and see if they're more virulent than any by themselves."
Cornman was among 100 or so
researchers in attendance last week at the Honey Bee Genomics & Biology
meeting, held at Cold Spring Harbor Laboratory in
"There has been a lot of progress made on how disease
affects honeybees at the molecular level," says Christina Grozinger, director of Pennsylvania State University's
Center for Pollinator Research in University Park, one of the conference
organizers. Around the same time that the genome was first published, honeybee
colonies across much of the Northern Hemisphere began to show alarming
declines. A syndrome dubbed colony collapse disorder (CCD) has been causing the
insects to die off in large numbers, leaving well-provisioned hives suddenly
empty. Meanwhile, other parasites, such as the Varroa mite (Varroa destructor),
which spreads harmful viruses, continue to take their toll. Annual surveys in
the
At the meeting, Cornman presented data showing that hives affected by CCD have higher levels of microscopic gut fungi called Nosema, and a greater prevalence of several viruses, two of which had not been detected in bees before.
Yet despite having a multitude of enemies, many bees are holding their own, says research entomologist Jay Evans of the USDA's bee laboratory. "The question is not why are bees getting sick, but how are they surviving against this onslaught of parasites," he says.
The genome offers a window into the bees' immune pathways, Evans adds. The goal is to identify the genes that are crucial in helping bees thwart attack, and, ultimately, to strengthen these defences. "You can breed for these traits, but with genetic markers you could do it faster," he says.
In cases in which nature cannot do the job, some researchers
are now exploring more direct ways of boosting bees' resilience. In some
insects, double-stranded RNA, a hallmark of viral infection, can provoke a
specific antiviral immune response. At the meeting, Michelle Flenniken, a virologist at the
Flenniken adds that knowing more about the bee's immune responses might help researchers to find ways of "priming the system" and help bees to cope with their foes at the genomic level. Such a prospect may be a long way off, but it's certain to keep researchers abuzz until their next gathering.
Farming on water: Stackable and sustainable
(chicagotribune.com)
– John Edel is turning a former meatpacking plant on
the edge of
In the basement, microorganisms are eating tilapia waste, converting it into fertilizer for the lettuce, kale and wheatgrass growing in a shallow pool of water nearby.
This process is called aquaponic farming. It minimizes water use while allowing year-round harvests, and it's just the beginning of Edel's vision for a futuristic, urban farm he has called "The Plant."
"The idea is that nothing leaves the facility but food — period," said Edel, 41. Half of The Plant will be rented to startup food companies, including a commercial brewery.
The heart of
Allen's disciples are converting far less logical sites into
aquaponic farms. In
Edel will be among the first to expand this concept across multiple floors of a single building: A shuttered 93,500-square-foot former pork-packing plant.
We're running out land to feed the world's exploding
population. (
Farms of the future must occupy less space, rely on fewer
pesticides and produce food that travels blocks, not miles to our tables, given
the skyrocketing cost of fuel. Such requirements have spawned concepts of farms
being housed in glass skyscrapers from
"We're not proponents of these fantasy skyscrapers," said Erika Allen, who is beginning to construct greenhouses and install fish tanks at Iron Street Farm. "The whole goal is to create a farm that's sustainable and makes money. And you can't make money if your infrastructure costs are too high."
What's profitable and achievable, Allen says, are tiered aquaponic systems, or minivertical farms in which fish and plants coexist off each other. Their ecosystems are linked via tubes.
Waste to energy
Edel's building at
Inside, broken concrete floors crackle as I walk. Dozens of windows have been filled with bricks. It is dark and cold.
But within a few years, Edel says a complex food-production system will be in place, the key to which is a $1 million, yet-to-be-bought anaerobic digester. Everything, and I mean everything, will be fed into it, from rotting tomatoes and meat, to brown and yellow grease.
On my last visit, it smelled like yeast outside.
"It gives us cover if we want to make foul smells of our own from time to time," Edel said.
The digester will convert the waste into gas, which will power a generator, which will power the facility. ComEd will not have to supply electricity.
"That's what takes us to the next level" of sustainability, Edel said. Most of "the power for the anaerobic digester will come from neighboring businesses' waste. … We're looking at 18 tons a day of biomass to power this place."
Edel anticipates receiving 2.1 million gallons a year of "beefy, sludge bioproduct" from a local food-flavoring maker. But the brewery, bakeries and the mom-and-pop tenants who will rent commercial kitchen space from Edel also will send their waste to the digester.
"Oddly enough, one of the great realizations we're having is we aren't going to be heating much at all," Edel said. "We're going to be cooling almost all the year in this building because all of the activities are heat-producing, especially these growing systems."
The building, formerly occupied by Peer Foods, was shuttered
four years ago when the meat packer shipped 400 skilled jobs to
Edel estimates that apart from the digester, the build-out will cost only $750,000. That's because Edel barters for things he needs and also counts on help.
On average, six volunteers a day are involved in demolition or remodeling. On a recent Saturday, Nick Santillan hammered away at cinder blocks in what was once a worker locker room. By day, he said he's a music producer.
Edel also is a recycler. Meat-hanging rails, for example, will serve as bike racks. Former smokehouses will be remodeled into bathrooms.
Idea planted early
Edel, who grew up in Rogers Park, looks the part of environmentalist/mad genius. He was wearing jeans and a khaki button-down shirt, both covered in dirt, when I met him. His reddish-beard had grown down the sides of his neck.
"One of the things I always wanted to do was grow plants inside industrial buildings since I was kid," he said. "Walking around in the Garfield Park Conservatory 35 years ago with my grandmother, and seeing this amazing derelict, rusting, collapsing place with water dripping everywhere and beautiful plants in it was kind of a transformative thing for me."
After graduating from the
In 2002, using savings and a $75,000 home-equity line of credit on his Logan Square two-flat, he bought another old building, a motorcycle junkyard at the time, and turned it into the Chicago Sustainable Manufacturing Center.
Relying on bartering and recycling, Edel said it cost him just $25 per square foot to renovate it. There is now a waiting list for green businesses wanting to lease space there. The rental income from the manufacturing center is paying for the mortgage on The Plant.
All that stands in Edel's way are city rules.
The law permits him to conduct aquaponic farming only for educational purposes, so his operation is run through a partnership with the Illinois Institute of Technology.
Commercial fish farming is forbidden in
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