winning cars, truck, and crossovers. hello and welcome to u.s. farm report. i'm john phipps. if you thought last year green reports, this year report lived up to the same excitement. al will give us the details in just a moment. yes, we can grow a -- crop in the u.s. many of us had become convinced we had corn production figured out. some areas did see some wonderful numbers, but even the most advanced seed machinery could not overcome the weather thrown at us. we're building a game plan to handle years like this better. funny how high prices can inspire such dedication. here's al pell. >> in the sequel to last week's surprising grain stocks report,

the usda added more stunning reports. average corn yield was dropped a breathtaking 6.7-bushels per acre. production is pegged at 12.7 billion-bushels and for beans the market was expecting slightly higher yields. still, a record but below last month. now, adding up all the changes and production used to carry out corn was moved below the psychological $1 million-bushel number. both numbers were sharply below analysts expectations. wheat numbers were in line with expectations but still revised lower. now, two of the world's leading growers are reporting problems. in canada, the world's second

largest -- is down. canadians fought wet weather all yearlong. in russia, a ban on experts may remain in place. as a result of the weather, harvest will be less than 66 million tons, 11 million tons below what the country needs itself. that's it for the headlines. now back to john for crop watch . our reporting partners are helping us with crop watch this week. sugar beat harvest is wrapping up. while on vacation no less, such dedication to send us photos. farm journals pam smith sent us this photo she snapped in

beardstown, illinois. tillage is under way. a grower compares rain totals this year in carolina. from april first to september 26 september 26th, they had 17 inches. it was a long, dry summer for farmers along the eastern seaboard. i would like to take a moment to personally invite you to the 2010 marketing rally coming this december just outside of chicago this. second annual event will bring together 16 of the best marketing minds in agriculture, including many of the analysts we see on u.s. farm report. it's a great chance to sharpen your skills for the year ahead. the two-day event is set for september 1st and second in the pheasant run report in illinois. for all the details, give us a call to marketing rally.com. bill there as well, so i hope you can join us.

when u.s. farm report returns, it's time markets. while many of us on farms were looking to washington for the crop

we have jim bauer. a big government report came

out. mark, sum up what happened on friday. >> limit up across the board. they were incredibly bullish. i've been saying for quite some time i thought it was between 155 and 157, the government comes out and says 158. we've got tough, tight situation in the corn. most analysts believe we're going shave that number down even as we go into the next couple of reports. with a carry out of 900 million- bushels, we've got a situation that's going to demand rationing. we started that process on friday and i'm sure we'll we -- see it on monday morning. the carry outs are down. they cut the acres. we've got bullish reports all the way around. the wheat carryout was cut and we're going the need to ration some of this grain with high e prices yet to come. >> every one of the reports comes along and it's like a

bang, and bang and then we've got another one up and down and whatnot. fill us in on what's going on. >> well, you and i talked about crop reports for decades. >> yes, i know. >> this report, my firm went into it with a little bit different bias. we've been calls hundreds and hundreds of different producers for the past four weeks, trying to get their exact yield off the combines as they rolled through the harvest. personally i thought the final number might be close to 155 based on what we were getting from the producers. the surprise to me -- and maybe mark will agree, they came in and did it so aggressively, considering the fact that these previous reports, they've been aggressive in the other way. so, again, i don't think the report is a surprise as far as yield to me, but it is a surprise to me the fact that the government acted so aggressively. >> we just generally don't see

that kind of decrease from one report to another. what may have happened is we had enough early corn in that they were able to get accurate measurements to verify this. now, is it going to get a lot worse through the rest of the harvest and will those numbers change? >> that's anybody's guess here. when you were dealing a week ago, there were extra corn bushels out there. a lot of people thought it was wrong. we've corrected all of that now. we have a pretty good handle on all these carry outs. the question becomes now how high is corn going to go. certainly pushing toward $6. that's going the drag the new crop up. you're going to have to take a strong look. we haven't told any of our clients to sell -- we're going to get to the point where we have to drag those prices up high enough to ensure that every acre gets planted next year as well. >> at this point in time the

prices, the way they were moving on friday, i think everybody was planning on it. we were thinking there was going to be over a billion bushels in corn. soybeans is a low carryout too. >> they didn't revise the yield higher. it does point out the sympathetic points. i also said within the next week or swear going to have these numbers dialed in. now our focus has to shift to the southern hemisphere. we've seen affects of el nina, so my focus will shift as a trader and advisor to the global market and the

purchasing power coming into these markets. the value of dollar is about 22 below par. >> you also brought up the supply. with our supply being curtailed a certain amount, that supply from other countries is going to mean more and the other countries will be looking what to plant to. >> we'll see farmers plant what they did. one of the things we have to look at is how are we going to decide what's going to go in the ground next year in the united states, corn versus beans. one of the big decisions, we've seen part of the problem with corn on corn this year because of these low yields. we're not going to see corn on corn again. that tells me we're going to see a pretty big shift back into the beans. however, we still got these big corn prices. that's going to try to draw and keep those corn acres back in

the game. we'll see how well that goes. >> when we come back, can you tell us what farmer cans do to take advantage in 2011? i think that's a possibility to. we'll be back with u.s. farm report in just a moment.

there's also users and we're talking about cattle growers and dairymen and chicken growers and so on and so forth.

the other thing of it is -- and you started touching on this, mark, a little bit. jim, i'm going to ask you first. what are the world reactions going to be to our report. they have to watch what we're doing. you mentioned as our dollar value goes down, it may be easier to purchase; is that right? >> the dollar adds about .778 to par. i don't think we're going to discourage corn consumption or bean consumption. it's going to take time. that demand out of china is on going. it doesn't seem to be diminished. it may occur in the southern hemisphere right now. i think overall i've been fortunate enough to wait on the cash sales. we've got about 60% of the beans to sell. 75% of the corn. i've instructed my staff to heighten their awareness to how

to market reacts to the daily information. as long as it acts good, fine. but when it stops performing then we're going to become more aggressive. i've alerted our staff to keep me posted on the weather. i really have to stay on my game from that standpoint. again, the function of the market is to ration this demand. a demand on corn that's been built over 16 years without too much, if any, disruption because of the constant supply. this is the time where the market is going to have to prove itself. >> i think the market is certainly going do that in the next few days, if not the next few weeks. i think it's important to understand how long is this market going to last? that's the question that everybody is asking. certainly given all things being equal. we've got to get this price high enough, quick enough to stop this demand base and to

get that carry out back to more comfortable numbers. i would argue that it's going to happen quicker and fast you are than people think. my guest is by the end of the year, we're going to have prices big enough to start shutting off the demand. we're going to get to the point quick enough that this isn't going to be the deal that lasts only to march or april of last year. i believe we're going to do it fast, settle this problem out and then we'll see what the next year brings. >> any comment? >> i'm not so sure about that. i think this market is taken 16 years to build a demand base. i don't know whether we can destroy it that quickly, that fast. mark might be right. if we get the price so high it shuts down, i would agree with that. i thought we were basically in the second quarter of a four

quarter ball game. again, i think it's not so much -- it's not so much the supply thing. i think now it becomes very oriented toward demand rationing and i'm not sure what that price is, but i know you're going to have to heighten your strategies and awareness. >> okay. now, we've only got a little bit of time. i want to know now the producers, how are they going the take advantage. we've only got a minute or so. everybody hasn't sold everything. do we need to look at next year's price? >> you certainly do have to start looking at next year's price. don't be selling a whole lot of 11 grain if you haven't locked in those input costs because you could get yourself into a bind there. start protecting $12 beans and $6 corn make as lot of sense to me. hopefully we can go to $8 corn

again and $15 beans, but we can't afford to watch this get killed in demand. in 2010 you're going to get a phenomenal opportunity to lock in some good prices. >> 30 seconds, jim. >> i've been selling all the way up and that's been winning. so until i see the puts stop eroding in value, i'm going to keep on selling them all the way up and then see what happens. when it stops working, that's where i'm going to stand. as far as the cash markets, i look for profitability margins. it's only so good for so long, as mark said, i leave that up to strategize. remember, this year, some of the people don't have the yields that they thought they had and they've got to revise we'll be back with more u.s. farm report in just a moment.

welcome back to u.s. farm report. it was way too much water in one week. look at the dramatic change in the drought monitor up and down the eastern seaboarder. you've got a summer's worth ovi rain in a week or two but it did change the monitor. now the worst areas shift to the west. dryer and dryer conditions into the southern great lakes as well. then we can see the dry areas out west. it's typical to see try and moderate drought areas in western areas and that's gotten dryer over the past month. it's still not dramatic at this point. there's a week system coming through the system. i don't expect a lot of rain

out of this. you can see the wave dampens a bit. a bigger trough starts to develop through the northeast. that will bring a shot of chilly air and then we have a brief warm there. this looks like another trop that digs into the great lakes as we head into that following week. obviously it is that time of year where we start to see chillier air. you can see a cool front going through the central portions of the country. scattered showers with that. maybe not a lot. some spotty ones in texas. the next one is stronger there. that front sweeps eastward and it's going to have decent showers there but probably not widespread or heavy. there's cold air coming in bind -- behind that front. another front coming into the pacific northwest.

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while many of us were looking on farms for crop estimates, there were other issues as well. one the struggle to unwind the mess that is our struggle market. the buzz word of the day is uncertainty. despite what they think, it doesn't refer only to the bush tax cuts. we underpriced risk and now after severe shocks, we're overpricing risks, reducing credit flows to trickles. this does not -- confidence to plan for the future. i can't see any action by congress or the white house or the federal reserve to rectify

these quickly. we node -- need to resolve the mess. one prediction i read this week was for a decade of slow growth in the u.s. followed by two more decades of slow growth. this seems about right to me. big holes take some time to fill in. making a long term commitment to this hard work would not just start us in the right direction, but would remove much of the uncertainty. after all, an unexciting but believable forecast is still a forecast we can work with. and one we might be able to make happen. please let us know what you think. send e-mails or call and leave us a voice mail. coming up in our next half hour, a scenic visit to big sky country. stay was. the 2nd half of farm report is coming right up.

travel advisories to small business loans. retirement savings to medicare coverage. id theft protection to contacting elected officials. student loans to taxes on-line. whether you have information to get or ideas to give, usa.gov is the official place to connect with your government. from surplus car auctions to finding a new job, our new mobile apps will keep you updated on the go. so from marriage records to passport applications, veteran's benefits to birth certificates, patent applications to energy saving eas, product recalls to home buying tips,

check out usa.gov. because the country runs better when we stay connected. woman: so here are the keys. congratulations! it's officially yours. i'm sure you'll have many happy years here. except for you. because you'll be gone three years from now. struck down by the same disease that got your father. so you won't be around for them. and sadly, it could have been detected early with a simple test. but you didn't have it. ok! who wan to check out the back yard? announcer: for a list of tests every man should have, go to ahrq.gov. report... new clues are uncovered in the mystery of colony collapse disorder it's enough to discourage any mom - we're still not eating our new clues are uncovered in colony collapse disorder. it's enough to discourage any

mom, still not eating eating vegetables vegetables. hello and welcome to the u.s. farm report. i'm john phipps. last weekend i went to my 40th 40th college reunion. some truly old friends from my engineering college had dinner together. the evening left me with many reflections. for example, one classman is now the largest -- of the world. there were lawyers and researchers and consultants and retired engineers, and one farmer. the binding link for all of us was the education in science. it opened more doors than we

could imagine in the 1970s. the need continues for young individuals to continue this training. let's go to the news and al pell. >> scientists have discovered -- a cure for ccd. that mysterious syndrome has led to a sharp decline in beehives coast to coast. samples collected from infected hives indicate both a fungus and a virus. it was previously unknown to north america. connie collapses are a huge problem because the bees are needed to pollinate numerous crops. government promotion aren't winning when it comes to fresh vegetables. a new report says only 26% of

the nations adults eat veggies three or more times a day. now, the amount of veggies adults are eating is the same as -- years ago. there's an explosion of farmers markets and salad bags. it's a troubling trend. there's not enough young people looking to pursue careers in science, engineering and technology. to help meet this need, a group associated with agriculture has kicked off a natural effort. last wednesday, young people across the country conducted a science experiment at the same time. the goal so to get kids hooked on science and technology. >> i think the trends are

showing that we're lagging behind in science in the unit and i think 4h is a good chance for kids to experience science. >> science is cool. you're going to run into it eventually. >> the goal of the national 4h experiment is to encourage youngsters. now to mike hoffman, meteorologist. well, things have been pretty train quell across most of the country. we're going to start to see some changes, not a lot of moisture to work with, but there's going to be scattered showers as we head into the earlier part of the week from east texas to the great lakes. i don't expect anything heavy

with this. perhaps some rain and mountain snow. by wednesday we see the first trough along the east coast. it develops in the center of the country, bringing in some colder air and that's going to be digging in. again, nothing widespread or heavy, but scattered thunderstorms. now, by the end of the week as we head toward friday, a pretty good trough. storm system probably along the mid atlanta coast will be causing some rains again. this is probably going to be the wettest area later in the week along the eastern seaboard. now to the next week. below than normal temperatures in carolinas, back into florida, above normal from the great lakes to most of the plain states. as far as precipitation next week, near normal more most of the corn belt. this whole area could use some

more of it. dry in the southeast where they could use some as well. below normal in the southwest and let's go out 90 days. for the next three months, expecting normal for the chunk of the eastern areas, but from the missouri valley into the southwest, precipitation over the next three months above normal in the northwest, but below normal for the southern part of the country the way it looks now. john? was deep-tilling some of my fields last week i mentioned how i was deep tilling a lot of fields this fall because deep water in the spring compacted the soil. in this week's farm quest, ohio farmer doug rupp tells us he's

made changes to his practices. rupp signed a contract with the us da to be part of the conservation steward program. nick, rupp must leave 30% of his crop untilled. >> last year we were in fairly aggressive tillage. it was a wet year. it created issues in the fall. and we've wanted to get away from that. now we're going to be at the 4, 5-inch level at the most depth and we're going to keep a lot of the residue in the top three or four inches. it's still going to be able to decompos, but it's not going to create the sponge effect like we've had in the past. we want to do that not just because we're required to, but we feel that's a better way to take care of soil. >> to learn more, head online

to www.ultimatefarmquest.com. when we return, talking cattle in the big sky country. spirit of the heart land is next. the cattle industry is

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uninsured and struggling. >> call the partnership for prescription assistance toll-free number now. the ppa team is standing by to help. >> hey, you know i was just kidding about them three championships. the cattle industry is staring at what it hopes is a strong 2011. herd numbers are down, demand is steady and the cattle industry is staring at what they hope is a strong 2011. prices are higher. demand is steady. that had producers smiling at this year's 2010 national angus conference. our crew traveled to big sky country where raising cattle is more of a livelihood. it's a lifestyle. clinton griffith has the spirit of the heartland.

>> reporter: big sky country, soaring moutains and cattle everywhere. for those living here, the payoff is less about cash and more about family. >> our boy have lots of energy and they love it. our daughter, she's a lot like her daddy. she can go out and scratch her cows and love her cows and pick them out. it's neat to see. >> the armstrong family took part in this year's national angus -- and tour. people showed up from all over the world for the event. it's a great way to showcase their operations, for producers. >> we run 1,000 registered cows and sell bulls to cattlemen in the united states. so we keep a pretty close watch on what we do genetically.

local herds is great for learning about management. participants got a view of the bigger picture. >> the things you get excited about are the potential to see renewed exports and better access in these markets to further access into japan. we would love to see access to the chinese market. that would be a tremendous opportunity for u.s. beef producers. we think that would happen at some point here in the next year. >> right now in iowa we're talking a lot about buy local. buy from family farms. i couldn't agree more. our operation is family farm. but now in the world is anyone going to raise natural beef, organic beef? you can't do it on a commodity price. >> policies may affect how these producers operate from year to year, but for most of them, it doesn't change why. >> i've been on this place for 30 years now. before that my dad was a dairy

farmer. i stepped out and did other things, but i love this. the financial rewards aren't great. my employees and i, we do it because we love it. >> for online coverage of the event, head to www.nationalangusconference.com next week we get in the halloween spirit as we get lost inside the meyers haunted maize. that story next week on further of the

i found the answers on -- i support projects that keep consumers loving beef. bull versus machine, who >> when it comes to bull versus machine, who comes out the

winner? baxter black joins us now with the answer. i with drew my plastic sleeve arm from the cow and looked back down the alley. it was empty, but i could see -- where a large bull stood. my son stood behind him trying to push him. >> get up on the fence. don't ever get up on the fence. they said he was tame. it doesn't matter, i said. never trust a bull. a bull can do whatever it wants. mr. t had a small farm in central indiana and in with the

cows he ran a reddish bull called red, of course. one day red decided to visit the neighbors. he pushed the fence over. the ground was wet and the posts gave like straws in the wind. with a bucket of grain and some -- red was coaxed back to his own side and the fence was repaired. red had returned to feast on the wrong side again. mr. t tried the grain routine to know avail. finally he came back in his pickup. he drove in the field behind red. he placed his front bumper against red's massive behind. dropped down into l on the automatic tranny and pushed. red rose to his full height. great, i'll just heard him back

through the hole in the fence. he looked over his should tore get the direction and then he began to move backwards. red had his head down and was pushing. mr. t put it back in forward and the mud flew as red continueed to push him backwards. something had to give. and it did. the hood, grill, radiator. two weeks later, red finally walked home on his own when he was good and ready. this is baxter black from out there. >> next week, baxter takes a trip to the car wash. until then, check out his work online at www.baxterblack.com. when we come back, tractor tales features a ford routine and we'll have our country church salute. cwwcq>cq>ca>cg÷woç>ç>cc sunshine state

for this week's "tractor tales". we >> we're off to the sunshine state for this week's tractor tales. we caught up with roger smith who tells us about a yellow ford 2000. >> this is a 1964 ford 2000 tractor. it's a yellow tractor, as you can see. that's unusual. it was an eastern airline tractor and didn't realize it was a yellow tractor until i started taking it apart. the more i took off of it, the more i knew i had an unusual piece of equipment. it's got an unusual number stamped on the housing also. it has your serial number and then c318 stamped on the housing. i took it all the way down. didn't have to do engine or

hydraulic work, but everything else, i took everything off and restored everything. it was in the restoration. the part i took off was yellow underneath and had the two blues -- the eastern airline blue and then kind of a whitish gray paint and then you grind more off and you have yellow under there. then, when you scratch that off, you have metal. so the original color was yellow on this tractor. so hopefully somebody that sees it and reads about it is going to let me know more information about this tractor. >> if you have any information for robert, please send a note to info at www.usfarmreport.com.

ourchurch,theymarktheir150 an ourchurch,theymarktheir150an niversaryinaugustofthisyear. the church building sun changed since its construction in 1860. although the congregation disbanded before, the current membership of 200 have an active array of ministries. we travel to the highest point in illinois, scales mound for our second salute this morning. the scales mound united methodist church began in 1831 in a log home of elijah charles. the original church had beautiful gothic stained glass windows which were replaced by art glass after world war i our

thanks to rick webster. as always, we would like to know about your home church as well. stay was the mail bag is next. weekly look

inside the farm report mailbag.... >> time now to check out the old farm report mail bag. dave thompson, an egg producer in illinois has this comment. i would suggest you spend as much time as possible helping livestock farmers fight off the mounting criticism of large farms. we're your customers, supporting us is just good business.

dave, thanks for sharing your view. you can read his full e-mail on our website. there's a reason i don't spend a lot of time cheerleaderring our livestock industry. first, i have doubt where is the cost ratio is what they say it was. it's possible we atrack more attention that spawns more debate. i see them as less threatening. nor does the rise of agrarian -- in addition, i agree with some of the criticism. we could treat animals better and lose very little economically. our livestock sector should have to stand accountable to our customers just like our grain buyers. finally, i have long reminded grain producers of the importance of our livestock sector and how ethanol

subsidies are unfair -- as always we want to hear from you. send comments to-- for al and mike, i'm john phipps, thank you for watching u.s. farm report. we'll be working to do even better. [brr, brr, brr]

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