Canola Quick Bytes
A supplement to U.S. Canola Digest
The U.S. Department of Agriculture has posted a dashboard with a breakdown of Emergency Relief Program (ERP) payments by crop. A total of more than $6.2 billion has been paid thus far in the ERP, including $68.63 million for canola. This supplemental disaster assistance was enacted by Congress to help agricultural producers offset the impacts of natural disasters such as drought and wildfires in 2020 and 2021.
On Aug. 16, President Joe Biden signed into law the comprehensive reconciliation package, named the Inflation Reduction Act. It includes an extension of the current $1 per gallon tax credit for biodiesel and renewable diesel, which would be extended through Dec. 31, 2024 (instead of expiring at year end). This tax credit would then be replaced by a Clean Fuel Production Credit from 2025 to 2027. Under this new tax credit, producers would get up to $1 per gallon based on a fuel’s carbon intensity score. The bill does not specify how the emission scores will be calculated, but it does establish a new Sustainable Aviation Fuel (SAF) tax credit for 2023-24. Each gallon of SAF would qualify for $1.25 plus $0.01 for each percentage point after 50 percent that lifecycle greenhouse gas (GHG) emissions are reduced. The SAF would then fall under the 2025-27 clean fuel scheme with its own credit system.
The Inflation Reduction Act includes about $40 billion for programs administered by the U.S. Department of Agriculture (USDA), including $18 billion for agricultural conservation to be distributed as follows:
- Environmental Quality Incentive Program – $8.45 billion
- Conservation Security Program – $3.25 billion
- Regional Conservation Partnership Program (RCPP) – $4.95 billion
- Agricultural Conservation Easement Program – $1.4 billion
An additional $1 billion would be provided to USDA’s Natural Resources Conservation Service for technical assistance and $300 million to the USDA for measuring the impact of agricultural practices on GHG emissions. All of the funding in this package must be spent within 10 years. Also included in the bill for agriculture:
- $5 billion+ for wildfire prevention and climate resiliency projects in forests
- $9.7 billion for rural electric cooperatives for renewable energy and energy efficiency projects
- $1 billion in loans for renewable energy projects in rural areas
- $4 billion in Bureau of Reclamation funding for compensation to those affected by temporary reductions in water usage; projects that reduce use of or demand for water supplies or provide environmental benefits in the Colorado River Basin; and ecosystem and habitat restoration projects addressing drought
- $2 billion for the USDA’s Rural Energy for America Program, which funds renewable energy and energy efficiency projects
- $500 million for blender pumps and other biofuel infrastructure
- $3.1 billion in assistance to “distressed” borrowers who hold direct or guaranteed farm loans
- $2.2 billion in payments to farmers who experienced discrimination in USDA loan programs (capped at $500,000 per producer) and debt relief provisions
The cost of the reconciliation bill is offset through a 15 percent minimum tax on corporations, a new excise tax on stock buybacks, and a provision that would allow Medicare to negotiate drug prices.
The Farm Service Agency (FSA) requires producers participating in federal farm programs to submit an annual report regarding all cropland on their farms. The data, compiled by FSA and released on Aug. 22, indicates U.S. farmers planted a record 2.237 million acres of canola this spring. North Dakota leads the top 10 states with 1.76 million planted acres, followed by Montana (167,267); Washington (118,444); Idaho (69,889); Minnesota (66,759); Oklahoma (16,060); Texas (9,459); Kansas (8,129); Oregon (6,970); and Colorado (5,069).
To swath or straight-cut canola? Because swathing takes more time, many canola farmers have been opting to straight cut instead. For growers unsure of which method to use, agronomists at Canterra Seeds and the Canola Council of Canada suggest the one that works well with their canola variety and other crops. An agronomist at G-Mac adds that farmers should be “mindful of other factors outside of swathing or straight-cutting when deciding on a variety to seed in the spring, including soil type and climate.”
A study published in the Canadian Journal of Plant Pathology found that lime helped reduce clubroot in canola by overall occurrence and severity of the disease by 35 to 91 percent. Lime works by neutralizing acidic soil, reducing the likelihood of spore germination and plant infection. However, experts say clubroot-resistant varieties remain the most effective form of protection.
have been expanding all over the state of Washington in the last decade. In 2011, around 11,000 acres were planted compared to 118,000 in 2021. Karen Sowers at the Pacific Northwest Canola Association says that she has seen the interest in canola grow significantly. This is for a few reasons, including a large Viterra canola processing plant opening in Washington in 2012 and canola being a great rotational crop.
Did you know canola oil is heart-healthy? In October 2006, the U.S. Food and Drug Administration authorized a qualified health claim for canola oil on its potential to reduce the risk of coronary heart disease due to its high unsaturated fat content. Consuming just 1.5 tablespoons of canola oil a day in place of saturated fat is enough to help protect the heart.
Other Country News
Due to the residual effects of COVID-19, the war in Ukraine and increased demand, canola prices around the world have skyrocketed. This has resulted in increased canola plantings in Australia but a wallop to the wallet for restaurateurs. A restaurant owner in New South Wales, Australia, says this is the new challenge post-pandemic.
Despite all other crop harvests being severely impacted by the war in Ukraine, the country is expected to harvest 2.73 million tonnes of rapeseed in 2022-23, which is only slightly below its five-year average. However, Ukraine still faces logistical problems due to blocked export passageways. Volumes could be seriously impacted if Odessa ports remain closed. If the ports open, crushers will likely process 280,000 tonnes of seed; if not, that volume will fall to 100,000 tonnes.
Latest Industry News
Companies like Danimer Scientific are investing big in bioplastics made from renewable products like canola oil in order to gain a bigger share of the nearly $600 billion global plastic market. The Georgia-based firm makes a bioplastic called PHA using microorganisms that ferment with canola oil. PHA is created in plastic pellets which can be molded in the same way as petrochemical plastic, according to Danimer CEO Stephen Croskrey. Danimer, which recently expanded its operations in Kentucky, is now one of the largest PHA producers in the world. Its PHA straws and drink stirrers are being used by Starbucks and Dunkin Donuts among other companies.
The Pacific Northwest Canola Association is also a resource for Montana canola growers. Karen Sowers, executive director, says the organization is member-based and strives to “help grow the canola industry in the Pacific Northwest and Montana through education, advocacy and marketing.” Visit pnwcanola.org to learn more.
The Minnesota Canola Council (MCC) held its 25th consecutive Canola Production Centre Field Day on July 20. Research plots this year were located on Magnusson Farms in the Roseau area. Project Manager Donn Vellekson and site agronomist Dave Grafstrom of the University of Minnesota briefed attendees on the progress of current trials, including: 1) variety and systems comparison; 2) seed shattering; 3) micronuntrient fertility management; 4) Roundup resistant weed control with an integrated soil and post-emergence weed control system; and 5) evaluation of novel seed treatments for enhanced flea beetle control. Data and information will be collected from these trials at harvest and a final report will be available at the MCC’s annual conference on Dec. 1 at the Roseau Community Center.
Another MCC Field Day was held on July 26 on the Steve Rodke farm south of Hawley, Minn. Rodke has grown canola for many years with great success. “I’m a big believer in the potential for increased canola production in this area,” he says. “It’s been a great crop for me both financially and agronomically.” The event featured a crop walk led by Grafstrom who gave attendees tips on planting canola, addressing seeding rate, row spacing, crop protection tools, fertility, and harvest options. In addition, University of Minnesota pathologist Megan McCaghey discussed crop protection tools for disease management. Other topics covered were canola marketing opportunities by Ray Albrecht of Cargill, canola seed products by Bethany Peterson of BASF, canola seeding equipment by Doug Schmidt of Butler Machinery, and USDA farm programs by James Kruize of the Farm Service Agency.
About the USCA
U.S. Canola Association (USCA) President Andrew Moore represented the U.S. canola industry at the International Oilseed Producers Dialogue (IOPD) meeting Aug. 28-29 in Des Moines, Iowa. He updated international oilseed grower groups from the Americas, Europe and Australia on U.S. canola production and current market and policy dynamics.
The USCA will hold its autumn board meeting in Scottsdale, Ariz., Nov. 9-11. More on UScanola.com.
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