Northern Plains – Wheat, Barley and Minor Oilseeds 2014 Farm Bill Education Conference Kansas City, MO September 3, 2014 Dwight Aakre Farm Management Specialist

The Northern Plains – Then and Now Historically –Wheat was the dominant crop, therefore high wheat base –Produced a major share of the U.S. barley crop –Very little precipitation from mid July through August Currently –Average annual precipitation has increased 20% in the last 20 years –Much of this increase coming in July and August –Increased disease pressure and difficult harvest conditions for small grain –Improved environment for corn and soybeans

State Average Counter-Cyclical Payment Yields, North Dakota Wheat29.7bu Barley43.6bu Soybeans30.4bu Corn81.0bu Sunflowers1151lbs Canola1097lbs Oats44.6bu Flaxseed13.2bu

State Averages, North Dakota Crop Current C-C Yield 90% of AverageChange Wheat % Barley % Sunflowers % Canola % Flax % Soybeans % Corn %

Payment Yield Update Farm’s current CC wheat yield: 32bu Will this impact reallocation of base? Will this impact ARC vs PLC decision? Average Yield PLC Yield (90%) Zero 90buZero 90bu81bu Plant

Existing Crop Base as a Percent of Total Base Acres, North Dakota Wheat64% Barley12% Soybeans7% Corn6% Sunflowers5% Canola3% Oats2% Flaxseed1%

Average Planted and Prevented Planted as a Percent of Total Covered Commodities Wheat44% Barley4% Soybeans22% Corn14% Sunflowers5% Canola6% Oats1% Flaxseed2%

Base Reallocation Strategies 1.Safety Net 2.Maximum Payments

Marketing Year Average Prices All WheatAll Barley All SunflowerCanolaFlaxCornSoybean

Marketing Year Average Barley Price All BarleyFeed BarleyMalting Barley 2012$6.43$5.62$ $5.35$4.91$ $3.86$3.22$ $4.66$2.61$ $5.37$3.82$ $4.02$4.35$3.87

Wheat – Walsh County Estimated Payment per Acre Prices StableRising*Declining* StableRising*Declining*ARCPLCARCPLCARCPLC *Price estimates provided by Frayne Olson, NDSU crops economist.

Barley – Bottineau County Estimated Payment per Acre Prices StableRising*Declining* StableRising*Declining*ARCPLCARCPLCARCPLC *Price estimates provided by Frayne Olson, NDSU crops economist.

Canola – Cavalier County Estimated Payment per Acre Prices StableRising*Declining* StableRising*Declining*ARCPLCARCPLCARCPLC *Price estimates provided by Frayne Olson, NDSU crops economist.

Sunflower – Emmons County Estimated Payment per Acre Prices StableRising*Declining* StableRising*Declining*ARCPLCARCPLCARCPLC *Price estimates provided by Frayne Olson, NDSU crops economist.

Flax – Ward County Estimated Payment per Acre Prices StableRising*Declining* StableRising*Declining*ARCPLCARCPLCARCPLC *Price estimates provided by Frayne Olson, NDSU crops economist.

Corn – Barnes County Estimated Payment per Acre Prices StableRising*Declining* StableRising*Declining*ARCPLCARCPLCARCPLC *Price estimates provided by Frayne Olson, NDSU crops economist.

Soybeans – Stutsman County Estimated Payment per Acre Prices StableRising*Declining* StableRising*Declining*ARCPLCARCPLCARCPLC *Price estimates provided by Frayne Olson, NDSU crops economist.

Estimated Increase in Payment Per Acre from Re-Allocation of Base Acres with Alternative Price Projections, Price Trend Farm/CropStableIncreasingDecreasing Wheat$16$5$28 Barley$7$10$15 Canola$20$3$9 Sunflower$6$4$14 Flax$3$1($1) Corn$19$6$25 Soybean$16$5$21

Conclusions Base re-allocation will have the greatest impact on potential payments Base re-allocation and yield update are the landowners decision Yield update will be significant for most crops Wheat and barley base acres will decline The change from “feed” barley to “all” barley significantly reduces potential payments for barley