Sugar beets growers expect second strong showing in 2009Written by Christy Hemken
“We had a tremendous crop,” says Wyoming Sugar CEO Cal Jones. “We had records in yields, 26 tons per acre, and content, 17.5 percent.” Wyoming Sugar collected slightly less than 10,000 acres of beets from Washakie, Big Horn and Fremont counties.
“We had a record crop here at Worland for Wyoming Sugar,” says Washakie Beet Growers President John Snyder, attributing that to weather conditions, genetics, grower care and attention and Roundup Ready seed.
In the Lovell area farmers pulled 24.4 tons of beets out of every acre with a sugar content of 17.16 percent. Yields reported by Western Sugar, which contracts beets in Colorado, Montana, Nebraska and Wyoming, averaged 22 to 26 tons per acre with 16 to 17 percent sugar.
Western anticipates 90 percent of its 2009 sugar acres will be planted in Roundup Ready seed. According to Syngenta Chief Executive Michael Mack, the decision last year to begin selling biotech sugar beet seed in the U.S. has been extremely profitable. In an interview with Dow Jones Newswires, Mack said Syngenta’s U.S. market share for sugar beet seed rose to 35 percent in 2008, up from 19 percent.
“Farmers flocked to our germplasm and traits,” said Mack. The USDA approved herbicide-resistant sugar beets in 2005, but they took a while to gain popularity because food and environmental groups raised concerns about the safety of sugar made from genetically modified beets. Litigation continues on the sugar technology, however, most countries with major sugar beet markets have approved herbicide- resistant varieties for use.
“It was our second year for Roundup Ready near Worland, as we were part of the limited launch in 2007,” says Snyder. “Our growers are certainly liking it, and it’s another tool in the toolbox for them to use.”
Lovell sugar beet producer and a member of the Western Sugar Board of Directors, Ric Rodriguez says well over half of the beets in his area were Roundup Ready varieties in 2008.
“They tended to yield a lot better than the conventional beets. We had a really late spring, and it was cold, but they came out of it a lot better than the conventional varieties that we had to spray two or three times,” says Rodriguez. “They were just a healthier beet that took off when it did get warm.”
The completion of the 2008 Farm Bill contained several important provisions for U.S. sugar beet producers.
“The Farm Bill was a real benefit to growers and sugar producers,” says Rodriguez. “There were a few good things that happened in the Farm Bill, for a change.”
“One of the things in the Farm Bill was a slight increase in the loan rate, as well as a provision in the bill that says 85 percent of U.S. sugar consumption has to be from U.S.-produced sugar,” says Snyder. He says the percentage usually runs right around 85, but now it’s in writing because of increased pressure from trade agreements.
“Another important aspect is that the USDA cannot accept, except under emergency situations, imported sugar above and beyond what’s agreed to in WTO until after April 1,” says Snyder. “That gives them more, and better, information on which to base their supply projections.”
Previously the USDA could draw conclusions and announce the importation of foreign sugar at any time, a move that has caused the market to drop significantly. “A lot of times they’d make announcements of additional imports when the market didn’t need it,” says Snyder.
By waiting until April, most of the processing from the year before is complete and planting intentions are generally known, which gives the USDA better information on which to base their decisions.
According to Western, which represents 1,400 growers, 2009 is shaping up to be another good year. That optimism is based primarily on two factors, including strong worldwide demand for sugar and additional Roundup Ready varieties.
In November 2008 Milling and Baking News reported bulk beet sugar in the Midwest was going for 35 cents per pound. Western expects upward movement in wholesale sugar prices in 2009. According to Paul Burgener, agricultural economist with the University of Nebraska-Lincoln, the 2009 grower price for sugar beets is projected to be $45 to $50 per ton with a break-even cost of $35 to $40 per ton.
Rodriguez says he expects planting of Roundup Ready varieties to be “significantly higher” in 2009. “With three years of data now instead of two, we’ve now got some better varieties coming in this year.”
Snyder says he expects Wyoming Sugar to contract close to the same acreage in 2009 as in 2008.
“A lot of the growers in Wyoming and in other areas are optimistic about the sugar market right now, and so far it looks pretty good,” says Snyder, noting that sugar beets are still a consistent crop to rely upon. “Last year sugar beets lagged behind other commodities, but now they’re more even as sugar beets have pulled ahead a little and the others have fallen behind where they were.”
“We’re optimistic to have another good year,” says Rodriguez.