Since successful breeding efforts in the 1970s made it possible to grow soybeans beyond southern Ontario, soybean area has increased eightfold, and this crop has become an economic success for farmers. Today's inaugural release from the 2006 edition of Canadian Agriculture at a Glance reviews the progress of this crop.

The online analytical article, "The soybean, agriculture's jack-of-all-trades, gains ground across Canada", is the first in a series that will eventually appear in the 2006 print edition of Canadian Agriculture at a Glance. Statistics Canada publishes Canadian Agriculture at a Glance every five years to showcase Census of Agriculture data. When the 2006 print publication is released in 2009, it will contain more than 30 analytical articles.

Farmers reported to the 2006 Census of Agriculture that they grew soybeans on just over 1.2 million hectares, a nearly eightfold increase since 1976. That was the year that varieties were introduced that could perform well in Canada's shorter-season growing areas. Until then, climate restricted soybeans primarily to southern Ontario.

In spite of a 4.1% drop in area between the 2001 and 2006 Censuses of Agriculture, Ontario was still by far the leader in soybean production in 2006, accounting for nearly three-quarters (73%) of Canada's soybean area, just over 872,400 hectares. Quebec placed second in terms of planted area, with 178,161 hectares.

However, it was the growth in soybean area between 2001 and 2006 in the Prairie Provinces that was particularly notable, according to today's report. Manitoba's soybean area increased sevenfold to just over 141,800 hectares, while Saskatchewan's increased sixfold to just over 2,200 hectares. Area in Alberta was about half that in Saskatchewan.

Although soybeans remain far behind canola and wheat as Canada's top cash field crop, in Ontario they were the most valuable field crop in 2006, generating $547 million and eclipsing the receipts from corn ($449 million) and wheat ($275 million).

Nationally, farmers' cash receipts from canola amounted to $2.5 billion in 2006, about 3.5 times the $680 million soybean crop. In comparison, farm cash receipts for wheat (excluding durum) amounted to $1.8 billion, potatoes, $899 million, and corn, $753 million.

The report chronicles the multitude of uses driving the demand for this versatile crop, from livestock feed to food-grade oils and soy foods such as soy milk, tofu and natto. It also highlights the crop's industrial uses, from plastics, fibres, lubricants and chemicals to biodiesel. Part of the Canadian soybean breeding program has focused on premium-priced beans tailored for the human food market.

In spite of placing seventh in world soybean production, Canada is a vigorous participant in soybean trade. Of the estimated 3.5 million tonnes of soybeans grown in Canada in the 2006 crop year, over 40%, or 1.5 million tonnes, were exported.

Japan led the list of overseas buyers in 2006, importing $138 million in Canadian soybeans. Malaysia was a distant second ($52 million), followed by the Netherlands ($49 million) and Iran ($43 million).

Mr Dickie said that a depressed agriculture hit the poorest people hardest. A strong market for agricultural crops encouraged development and provided jobs, but a depressed agriculture made people in poorer countries more dependent on government aid and more vulnerable to poor governments.

Earlier he said that there were large areas of land in many parts of the world that could be brought into arable production. For instance Brazil had an area of savannah the size of Europe that would be well suited to grain production.

The reason it had not been used for grain was the lack of good roads, but as world grain prices rose it could become economic to build these roads and bring into production, said Mr Dickie.

Other countries with large areas of land that could potentially be brought into grain production and would not need irrigation included USA, Ukraine, Russia, Ethiopia, and Nigeria. Overall it was estimated that all these countries, had 188 million hectares suitable for grain production.

While average wheat yields in the UK were eight tonnes per hectare, even taking the world average yield of 3 t/ha, this land held the possibility of large amounts of grain entering the market, he said.

This showed that production of cereals and oilseeds would rise to supply the demands of both the food and non-food sectors and this would involve cropping previously idle land.

There was no doubt producing food and fuel from agriculture could co-exist. These would be balanced by the distribution of market prices so supply and demand would be balanced.

Possible damage to the environment was more challenging. As more land was drawn into production, there was a need to be aware of the risk of abuse to eco-systems and carbon efficiency, said Mr Dickie.

© 2007 by CMP Information Ltd.

"Just as Florida has its oranges and California its raisins, we want to make Western Canada synonymous with wheat," CWB President and CEO Greg Arason said.

The major branding initiative - the first of its kind for both partners - will raise awareness of the high quality of Prairie wheat among Canadian consumers through labelling on Robin Hood flour bags and other promotional activities.

"The wheat grown by western Canadian farmers is the best in the world - we know it, farmers know it and our customers around the globe know it," Arason said. "Now millions of Canadian consumers will get the message too."

The campaign is the CWB's first major national foray into co-branding. It will include a CWB wheat quality message and label on five million bags of Robin Hood flour, a message about the goodness of western Canadian wheat in about 3.5 million "Baking is Back" recipe booklets now being distributed in stores and magazines, as well as store displays and online contests.

"As Canada's leading flour producer, Robin Hood is committed to supplying Canadian consumers with the best flour in the world: flour made with 100-per-cent Canadian wheat," said Cheryl Malton, spokesperson for Smucker Foods of Canada, owner of Robin Hood.

Robin Hood flour is milled in facilities across the country, including a mill in Saskatoon. "We have a 98-year relationship with Canadian consumers, dating back to our roots in Moose Jaw, Saskatchewan," Malton added. "We know Canadian consumers also feel supportive of Prairie farm families, so this is a natural partnership."

The campaign aligns with consumers' desire to eat identifiable Canadian-grown food. A 2007 Canadian Federation of Agriculture (CFA) survey showed 95 per cent of consumers would choose Canadian products over imports if doing so improved the viability of family farms. Ninety per cent wanted Canadian-grown food to be easily identifiable. The CFA, Canada's largest farm group, has made creation of a "Canadian-grown" food labelling system the top issue it would like the federal government to address this fall.

Western Canadian farmers support promotion of their products' quality. In a recent CWB survey, over 80 per cent of farmers thought the CWB should brand Prairie wheat.

The campaign also celebrates the return to popularity of healthy, grain-based foods. Per-capita flour consumption is on the rise in North America since it hit record lows in 2004, largely due to low-carbohydrate diets. "The renewed popularity of grain-based foods is very positive for farmers, the milling industry and the health of Canadian consumers," Arason said, adding the CWB helps fund a campaign called "Grains, They're Essential!" to battle the low-carb fad. The CWB has also created a Web site at www.prairiewheat.ca about the goodness of Prairie wheat.

Controlled by western Canadian farmers, the CWB is the largest wheat and barley marketer in the world. One of Canada's biggest exporters, the Winnipeg-based organization sells grain to over 70 countries and returns all sales revenue, less marketing costs to farmers.

Antibiotics used on livestock pose minimal environmental risk in Canada, according to a new University of Guelph study.

Prof. Paul Sibley, Department of Environmental Biology, and Prof. Keith Solomon, Centre for Toxicology, recently completed a six-year study examining the use of pharmaceuticals in the Canadian hog and cattle industry. They found that pharmaceuticals don't pose appreciable risks to soil and water if used as instructed.

“We’ve found evidence that suggests there’s little risk to soil and aquatic biota from using pharmaceutical products," said Sibley.

Pharmaceuticals first raised concerns when they were detected in the environment more than a decade ago. It was thought they could cause contamination through simple routine practices such as manure spreading. Animals administered antibiotics excreted them through feces or urine, which was then applied to land and could cause damage to soil systems or migrate into nearby waterways.

To determine whether these concerns were valid, Sibley, Solomon and a team of researchers simulated real-life scenarios in the laboratory and field to study the toxicity of pharmaceuticals. They applied pharmaceuticals directly to soil and water to simulate field exposure. This direct exposure would be similar to an actual worst-case scenario, making it a good test of potential risks, said Sibley.

After applying the pharmaceuticals, the researchers tested the soil, soil life, water and aquatic life in the area to measure the level of toxicity. They also measured concentrations of antibiotics at several locations on the Grand River watershed heavily populated with livestock.

In both studies, they found the level of antibiotics detected was "significantly" lower than the amount required to elicit toxic responses and was therefore likely to pose negligible environmental risk, said Sibley.

The long duration of some of the studies, which ran up to 60 days, helped the researchers accurately assess changes in contamination levels and toxicity over time, ultimately leading to a stronger conclusion that supports environmental safety, he said.

“I hope this research still encourages pharmaceutical companies, veterinarians and producers to be more efficient with their antibiotic treatments but, at the same time, eases any thoughts of potential negative environmental effects.”

“We expect a continuously growing demand for agricultural products, and in the future this demand will be driven not only by the production of food, feed and fiber but also by the use of biofuels", said Professor Friedrich Berschauer, Chairman of the Board of Management of Bayer CropScience AG, at the company’s Annual Press Conference in Monheim. Berschauer explained that limited agricultural land, the uninterrupted growth of the world's population and the impact of climate change are threatening the supply of agricultural products and are leading to shortage-driven prices for major agricultural commodities. He described this development as a “silent agricultural revolution.” Bayer CropScience expects the use of agricultural raw materials for the production of biofuels to increase considerably, and this will benefit both the seed market and the crop protection market. Professor Berschauer: “Innovation and constant technological progress are the only way to overcome this challenge."

Therefore, Bayer CropScience plans to increase its annual research and development budget to some EUR 750 million by 2015 (2006: EUR 614 million). The company’s research effort is focused on promising areas such as new modes of action in crop protection, improved plant health as well as optimized plant characteristics and new agronomic traits. It is also increasing its emphasis on aspects such as herbicide tolerance, insect resistance and increased yields. Bayer CropScience is additionally working on new biotechnological approaches to making plants more resistant to a number of stress factors such as heat, drought, cold and soil salinity. The first products from this stress tolerance research program are expected to reach the market in 2015.

“We are convinced that we can only keep pace with the future requirements of the new agricultural economy if we use all the options available for safeguarding harvests and increasing yields”, Berschauer emphasized. “The increase in productivity which we will need to achieve in agriculture in the coming years will only be possible with modern crop protection and the new approaches offered by plant breeding and plant biotechnology.”

Promising active ingredient and plant biotechnology pipeline

Bayer CropScience started a launch program in 2000 with the objective of bringing 26 new active substances for crop protection to market by 2011. “We expect these substances to have a combined peak sales potential of approximately EUR 2 billion”, the CEO said, underlining the contribution of crop protection research to Bayer CropScience’s value-added. Of the total of 26 compounds, 17 had already been launched by the end of 2006 and last year achieved sales of EUR 1 billion.

Throughout 2007, the company has received regulatory approvals for three more active ingredients in their first markets. It also has ten substances in late-stage development and another nine at an early stage of development. Bayer CropScience will continue to draw on a wide range of new and promising research projects in the future. Currently, the company has 45 new projects at an early stage of research.

The company also has a well-equipped seed and plant biotechnology pipeline which currently contains over 40 lead projects. It has six herbicide tolerance and insect resistance projects in a late-stage of development. They are scheduled for launch from 2010 onwards. Furthermore, the introduction of three new herbicide tolerance traits is also planned within the next three years, amongst them one that confers tolerance to the herbicide glyphosate. “We are confident that our BioScience pipeline will be a major source of new impetus as we expand our business”, Berschauer said.

Seed and biotech sales planned to reach EUR 1 billion within ten years

“Within the next ten years we want to expand sales in our BioScience business from the 2006 level of EUR 342 million to around EUR 1 billion”, was how Berschauer explained the unit's growth potential. In order to reach this target, Bayer CropScience is making considerable investments in research and development and in the targeted expansion of its seed portfolio. In this context, the acquisition of Stoneville’s cotton seed business in the United States, with a transaction volume of US-Dollar 310 million, is the biggest single acquisition since Bayer CropScience was established. The company is currently Number 2 in the global cotton seed market and is able to offer a wide range of seeds that combine attractive traits with high yields and excellent fiber quality.

In addition, within the last 12 months the company has acquired the two U.S. cotton companies CPCSD and Reliance Genetics, the Korean company SeedEx with its hot pepper and brassica varieties, and Unilever's tomato seed business. It will also be setting up two joint ventures in China, the world’s largest hybrid rice market. The partners are Lu Dan Seed Company and Nong Ke Seed Company.

New opportunities in the corn and soybean markets

In the future Bayer CropScience is planning to increase its involvement in the markets for herbicide-tolerant and insect-resistant corn and soybean varieties. To this end, the company plans to award licenses to use its LibertyLink® herbicide tolerance technology to seed producers and dealers and thus to participate more effectively in the growth of the U.S. corn and soybean markets. Bayer CropScience concluded a licensing agreement of this kind with the Monsanto Company in June 2007. In addition to licensing royalties, Bayer CropScience is anticipating higher income from sales of its total herbicide Liberty®. The company estimates that the global market for biotechnologically optimized plant traits for corn, soybeans, canola, cotton and rice will double in value between 2005 and 2015, to around EUR 3.6 billion.

Berschauer commented that Bayer CropScience will continue to review opportunities for cooperation and acquisitions with a view to developing its BioScience business further. The focus will be on canola, cotton, rice and vegetables - crops in which the company is already well placed in the seed business.

Jatropha – An alternative biofuel feedstock

In response to the enormous global demand for biofuels, Bayer CropScience is working on ways of using plants which have not featured in agriculture to date as an economically efficient feedstock. One of these plants is Jatropha curcas, an oil-bearing shrub with inedible fruit which grows predominantly in arid regions. The seeds consist of more than 30 percent oil which can be used to make a low-pollutant biodiesel which reduces CO2 emissions. The advantage is that this biodiesel can be used in many engines worldwide without the need for extensive technical modification. Jatropha can be cultivated on marginal land in tropical and subtropical regions, or in other words on land that is unsuitable for producing food crops. “We hope that our research in this area will make a major contribution to the development of a sustainable biofuel industry”, Berschauer said.

First half of 2007: A record level of EBIT after special items

In operating terms the financial year 2007 has also been very satisfactory for Bayer CropScience so far. Sales in the first six months were on the same level as last year at EUR 3.35 billion. Adjusted for currency and portfolio effects, this corresponds to an increase of 4 percent. “Our EBIT after special items reached EUR 709 million, the highest level since our company was set up in 2002”, Berschauer commented.

Sales of new active ingredients developed particularly well in the first six months, growing by 30 percent to EUR 792 million. The BioScience business also turned in a gratifying performance, with sales growing by 6 percent (adjusted for currency and portfolio effects: 10 percent). The Seed Treatment business also developed very well, growing by 17 percent (adjusted for currency and portfolio effects: 25 percent) as a result of increasing demand for biofuels. Berschauer said that Bayer CropScience expects to top the sales threshold of EUR 500 million in the Seed Treatment Business Unit (2006: EUR 467 million) for the first time with sales for the full year 2007.

Bayer CropScience is optimistic about the second half of the year, and plans to increase sales above the previous year’s level. The company is aiming for an underlying EBITDA margin in excess of 22 percent for the full year. In the medium term, a number of cost-structure programs, which are expected to yield savings of EUR 130 million in 2007, should contribute to improving the company’s profitability even further. Assuming normal market conditions, Bayer CropScience anticipates being able to achieve an underlying EBITDA margin of 25 percent in 2009.

Bayer AG is a global research-based and growth-oriented enterprise with core competencies in the fields of health care, nutrition and high-tech materials. Bayer CropScience AG, a subsidiary of Bayer AG with annual sales of EUR 5.7 billion (2006), is one of the world’s leading innovative crop science companies in the areas of crop protection, non-agricultural pest control, seeds and plant biotechnology. The company offers an outstanding range of products and extensive service backup for modern, sustainable agriculture and for non-agricultural applications. Bayer CropScience has a global workforce of about 17,900 and is represented in more than 120 countries. This and further news is available at: www.newsroom.bayercropscience.com

WINNIPEG, MANITOBA - Six western Canadian grain shippers today announced they will file new level-of-service complaints against CN Rail, which has failed to comply with the spirit of a recent Canadian Transportation Agency (CTA) ruling. The outcome of the case will have major implications for grain transportation in Canada.

The first complaints, from the Canadian Wheat Board (CWB) and North East Terminal Ltd., were filed today with the CTA. The CTA ruled in July that CN had failed to fulfill its obligations to Great Northern Grain, a northern Alberta inland grain terminal. Because of the systemic nature of the rail shipping problems, the CWB and nine other grain shippers were core interveners in that case, also supported by the governments of Alberta and Saskatchewan, other grain-industry organizations and major farm groups.

"Farmers and most of Western Canada's grain shippers continue to be left at a disadvantage from ongoing, system-wide service shortfalls at CN," said CWB President and CEO Greg Arason, noting that four meetings with CN since the CTA's July ruling have not reached a satisfactory outcome. He said the minor changes made recently by CN will not result in enough flexibility to efficiently move farmers' grain to port.

In their applications, the grain shippers are asking the CTA for an interim order to suspend CN's advance-products program (which will award rail cars to bidders Sept. 6) until a resolution can be found. They have also formally indicated a desire for a mediated solution that would avoid full litigation before the CTA panel.

The CTA found in July that problems with CN's rail car distribution program were not isolated to one company, but "systemic in nature". The Agency also found that CN's current rail car distribution practices "have resulted in the replacement of a reasonably accessible, transparent, user-needs based car allocation process with a more restricted, less transparent regime that does not provide an adequate level of services for grain shippers.

"The consequence of this is a radical and detrimental transformation of the nature and operation of the marketplace within the grain handling and transportation system in Western Canada." (Page 20, Decision No. 344-R 2007)

The CTA's decision emphasized the Agency's expectation that its findings would "help to encourage a new and open dialogue between CN and its shippers so that they are able to reasonably deal with car-supply issues independent of regulatory intervention to the greatest possible extent."

Garnet Ferguson, general manager of North East Terminal Ltd. in Wadena, SK, said a meaningful dialogue has not occurred with CN since July.

"The changes that CN has made amount to nothing more than tinkering," Ferguson said. "We need equal and accessible rail service for all shippers - not just a select few. We believe CN has failed in its legal obligation to provide us with adequate service."

The other grain shippers who will file their cases this week are: Parrish & Heimbecker Ltd., Paterson Grain, Providence Grain Group Inc. and North West Terminal Ltd. The case is also actively supported by Great Northern Grain Terminals Ltd., South West Terminal Ltd. and Weyburn Inland Terminal Ltd.

For more information, please see the attached backgrounder and visit http://www.cwb.ca/public/en/hot/rail/ , which includes a link to the July CTA ruling.

Background

- In Western Canada, there are two Class One railways: CN and Canadian Pacific Railway (CPR) plus a handful of shortlines. Because the mainline railways own and operate the lines over which all traffic must travel, they determine the car supply available for shippers, whether the grain originates on their lines or not.

- CN and CPR are mostly geographically separate. In Western Canada, there are 146 grain-handling facilities on CN lines. Only 23 facilities in the West can access either railway by having access to both CN and CPR or the ability to inter-switch traffic between lines. Most shippers are captive to one railway.

- CN allocates rail cars to grain shippers in two ways:

1) Advance cars booked for virtually the entire year, with preference given to bookings for the largest number of consecutive weeks and to those with the highest-volume shipping history with CN. Advance cars are guaranteed capacity, with penalties for default by either party. In 2006-07, advance cars were 69 per cent of the total CN supply to Vancouver.

2) General car supply offered weekly with no guarantee that the railway will provide booked cars. There are no restrictions on unit size and no additional charges above the posted rail tariff freight rate. During times of tight supply, the general-car program is often reduced to ensure that guaranteed advance cars are used and penalties avoided.

- In July 2006, CN completely removed its 50-car products (called "GT Secure") for yearly advance bookings and offered only 100-car units ("GX100"), which must essentially be booked for 42 consecutive weeks to secure supply. After a level-of-service complaint was filed in March 2007, CN re-introduced the GT Secure program, but with only a limited supply of 50-car blocks that does not satisfy shippers' concerns.

- Because smaller companies and single-point shippers cannot forward-book into a single rail corridor for consecutive weeks, they cannot participate in the GX100 program. They can participate in a cash-bid program for cars ("GT PRO") but this is a limited planning tool because the companies may not get the cars they bid for during high-demand periods.

- CN has insisted on continuing use of its 100-car advance programs and has proposed only small changes to existing programs rather than addressing the deficiencies that these programs create. CN's proposal will continue a significant shortfall of car supply for many shippers in the 2007-08 crop year, as there was in the last crop year.

- The grain shippers involved in this case are asking that the 100-car requirement be eliminated in favour of 50-car offerings (which could be combined into blocks of 100 if needed). They also want CN's practice of auctioning cars to the highest bidder to be discontinued. They have also asked that CN be required to distribute at least 50 per cent of its rail car fleet as general weekly distribution.

A bit of history

(Excerpts from CTA July 2007 ruling No. 344-R, pp. 11-12)

- Historically, grain moved under subsidized freight rate was subject to a maximum rate structure under the Western Grain Transportation Act (known as the Crow Rate). In 1996, the WGTA was repealed and replaced by a regime of freight-rate caps.

- After the repeal of the WGTA in 1996, until 2000, distribution of overall rail car supply for western Canadian grain was the responsibility of an industry-led group called the Car Allocation Policy Group (CAPG), which included all the major participants in the grain handling and transportation sector and included the railway companies, the CWB, major grain companies and smaller shippers.

- The main objective of CAPG was to effect allocation through a formal, non-legislative, consultative process to avoid gridlock, foster greater accountability between shippers and carriers and set high-level car allocation policy for western Canadian grain traffic. A four-person executive committee, made up of one railway representative (either CN or CP), the CWB, the Western Grain Elevator Association (WGEA) and a producer, established certain guidelines.

- Under CAPG, car allocation was negotiated between the railways, the CWB and the WGEA for commercial and rate-regulated corridors.

- With the disbanding of CAPG in 2000, there was a movement towards establishing commercial arrangements for the management of rail logistics for western Canadian grain. Grain companies began negotiating directly with the railways to arrange car supply. For certain portions of this supply, the railways began offering advance-order products designed to provide a range of service, price and product options, as well as volume-incentive discounts.

- Note: For the 2006-07 crop year, which began August 1, 2006, CN Rail instituted changes to its advance-product program which have become the focus of the level-of-service complaints filed this week and in March 2007.

- The extent of the rationalization of the grain handling and transportation system has been significant. For example, it has resulted in the decline in the number of grain elevators in Western Canada from 1,004 (in 685 communities) in 1999 to 374 (in 282 communities) by July 31, 2006. This rationalization is the result of, among other things, the development of high-throughput elevators that have holding capacities of 10 000 to 20 000 tonnes. Today, seven grain companies control 87 per cent of the total primary elevator capacity on the Prairies.

Ontario Farmers to Benefit from New Definition of "Farming"

TORONTO - To help ease the tax burden on Ontario's farmers, the Ontario government is allowing more farming activities to be retail sales tax exempt, Finance Minister Greg Sorbara announced August 28, 2007.

"The expanded RST exemption will allow farmers to invest more money into their farms," said Sorbara. "It will also help to maintain a stronger, more sustainable farm sector in Ontario."

Effective August 28, 2007, the definition of farming will be changed to ensure certain post-harvest activities, such as cleaning, sorting, grading, packing, packaging and storing crops will be included in the RST exemption. As a result, more activities will qualify for the RST farm building materials exemption and farm equipment and supplies exemption, provided the building or equipment is used exclusively in the business of farming.

To claim the exemption, farmers must present the supplier with their farmer identification (ID) card or provide a valid Purchase Exemption Certificate (PEC). Since April 1, 2005, farmers have been able to use their general farm organization ID cards in place of PECs to obtain point-of-sale RST exemptions.

"The change to the RST exemption is yet another example of the respect this government has for Ontario's farmers," said Leona Dombrowsky, Minister of Agriculture, Food and Rural Affairs. "I want to thank the farmers who have worked with their local MPPs to bring about this change that will help farm families prosper."

Details about the expanded definition will be available in an Information Notice to be sent to retailers of farm building materials, equipment and supplies, and farm organizations.

The government has made strategic investments to help rural communities foster partnerships and pursue innovative approaches to challenges and opportunities. These investments include: <<

- OMAFRA Expenditures for Farm Income Stabilization and Support (2003-04 to 2006-07): $1.12 billion - Farm Property Class Tax Rate Reduction (2006): $300 million

- Retail Sales Tax Exemption for Agricultural Goods (2006): $250 million

- Fuel Tax Exemption for Coloured Fuel Used in Farm Equipment (2004): $43 million

- $500,000 Lifetime Capital Gains Exemption (2006): $45 million

- Value to Farm Corporations of Small Business Corporate Income Tax Rate (2006): $27 million

- Expected OMAFRA Expenditures for Agricultural Drainage Infrastructure Management (2006-07): $6.5 million

- Expected OMAFRA Expenditures for Nutrient Management Assistance (2006-07): $5.6 million

- Land Transfer Tax Exemption for Transfers of Farm Land between Family Members (2006): $5 million.

Ithaca, NY - When soils are too acidic, aluminum that is locked up in clay minerals dissolves into the soil as toxic, electrically charged particles called ions, making it hard for most plants to grow. In fact, aluminum toxicity in acidic soils limits crop production in as much as half the world's arable land, mostly in developing countries in Africa, Asia and South America.

Now, Cornell researchers have cloned a novel aluminum-tolerant gene in sorghum and expect to have new genetically-engineered aluminum-tolerant sorghum lines by next year.

The research, to be published in the September issue of Nature Genetics, provides insights into how specialized proteins in the root tips of some cultivars of sorghum and such related species as wheat and maize can boost aluminum tolerance in crops.

Sorghum is an important food crop in Africa, Central America and South Asia and is the world's fifth most important cereal crop.

"My lab has been working to identify the physiological mechanisms of plant aluminum tolerance as well as its molecular basis," said Leon Kochian, the paper's senior author, a Cornell adjunct professor of plant biology and director of the U.S. Department of Agriculture--Agriculture Research Service (USDA-ARS) Plant, Soil and Nutrition Laboratory at Cornell. "The reason this is significant is there are extensive areas of the earth's lands that are highly acidic, with pH of 5 or below [pH below 7 is considered acidic]. Most of these areas are in the tropics or subtropics, where many developing countries are located."

Kochian's research shows that in aluminum-tolerant sorghum varieties, special proteins in the root tip release citric acid into the soil in response to aluminum exposure. Citric acid binds aluminum ions very effectively, preventing the toxic metal from entering the roots.

Kochian and colleagues, including the paper's first author, Jurandir Magalhaes, who received his Ph.D. from Cornell in Kochian's lab and now directs his own lab at the Embrapa Maize and Sorghum Research Center in Brazil, used genetic mapping to identify a single gene that encodes a novel membrane-transporter protein responsible for the citric acid release. The gene, they discovered, is only turned on to express the protein and transport citric acid when aluminum ions are present in the surrounding soil.

The researchers have now used the sorghum gene to engineer transgenic aluminum-tolerant Arabidopsis thaliana (a small mustard plant used in plant research because of its small genome and short life cycle) and wheat plants. Sorghum is harder to genetically transform, Kochian said.

The map-based cloning of this agronomically important gene in sorghum is helping advance this species as a model for further exploring the mechanisms of aluminum tolerance and discovering new molecular genetic solutions to improving crop yields, Kochian said.

"This research also has environmental implications for badly needed increases in food production on marginal soils in developing countries," said Kochian. "For example, if we can increase food production on existing lands, it could limit encroachment into other areas for agriculture."

The research is supported in part by the McKnight Foundation Collaborative Crop Research Program, the Generation Challenge Program, the National Science Foundation and the USDA-ARS.

Crop receipts reached a first half-year record of $8.4 billion, supported by higher grain and oilseed prices and strong grain deliveries. This total was 25.6% above the January-to-June 2006 level and 15.5% higher than the previous record set in 2004.


Receipts for livestock producers increased 4.9% to $9.3 billion in the first half of 2007 as cattle revenue increased, hog prices improved from low levels in 2006, and dairy and poultry prices rose.

At $2.2 billion, program payments declined 14.2% during the first six months of 2007, 4.5% below the five-year average (2002 to 2006), a period which saw record high payments resulting from adverse weather conditions, low grain and oilseed prices and the bovine spongiform encephalopathy situation.

In total, farm cash receipts—revenue from crops, livestock and program payments—reached $19.9 billion, a new record. This total was 9.8% above the one posted for the first half of 2006 and 11.8% above the previous five-year average for the January-to-June period.

Farm cash receipts provide a measure of gross revenue for farm businesses. They do not account for expenses such as feed costs, which will reflect the higher grain and oilseed prices present in the market over the past year or so.

Provincially, farm cash receipts rose in all provinces, except in Prince Edward Island and New Brunswick, where potato receipts declined from the near-record levels observed in the first half of 2006, and in British Columbia, where receipts remained flat. Increases in all other provinces ranged from 3.1% to 23.2%. The Prairie Provinces experienced double-digit increases, mainly because of higher grain prices.

Crop receipts boosted by higher grain and oilseed prices

Supported by the growing biofuel sector in the United States and the European Union, and by concerns over new crop production and tight global supplies, grain and oilseed prices surged from very low levels in the 2005/2006 crop year. Near-record grain production in 2006 also translated into strong deliveries by Canadian farmers during the first half of 2007.

Revenues from wheat (excluding durum) rose 66.0% to $1.5 billion, as a result of higher prices, deliveries and Canadian Wheat Board (CWB) payments. Similarly, durum and barley receipts jumped by over 50%, bolstered by higher prices and CWB payments. However, deliveries of both these crops were down, largely due to lower production in 2006 as producers substituted other crops and yields declined.

Canola receipts reached $1.5 billion, a second consecutive record for a first half of the year. This increase was driven by a 41.4% price gain. Despite being lower, the January-to-June canola deliveries were more than 50% above the previous five-year average. Higher prices and deliveries pushed soybean revenues up 46.7% to $402 million. Similar to canola, soybean production has grown in recent years due to strong demand for vegetable oil and edible soybeans.

Corn receipts increased 50.9% to a record $478 million in the first half of 2007, as prices and deliveries rose 40.8% and 7.1% respectively.

Potato receipts fell 3.2% to $421 million, as an increase in marketings (+9.4%) was more than offset by an 11.5% drop in price. Despite an effort by Canadian farmers to reduce areas planted to potatoes in 2006, very good growing conditions led to record yields and production. High supplies pressured prices; they fell almost 6% below the previous five-year average for a January-to-June period.

Improvements in prices drive up livestock revenue

Livestock receipts increased in the first half of 2007 as most livestock and animal product prices gained ground.

Cash receipts from cattle and calves, which are comprised of the revenue from domestic slaughter, interprovincial export and international export, rose 3.4% to $3.2 billion, mainly the result of higher prices (+2.7%). Marketings (the total weight marketed) increased 0.6% in the first half of 2007, reaching their second highest level on record for a January-to-June period.

Despite the appreciation of the Canadian dollar, more feeder and slaughter cattle are being shipped to the United States to satisfy the strong demand. Revenues from international exports of cattle grew 17.4% to $693 million, as the number of animals exported increased 17.1%.

Receipts from interprovincial export of feeder cattle rose 15.7% to $335 million, the result of a 24.4% increase in the number of head sold. Higher costs for feed grains pressured feeder cattle prices downward.

Receipts from domestic slaughter, which account for almost two-thirds of cattle receipts, edged down 0.5%. Gains from prices (+5.0%) were offset by lower marketings.

Hog revenues were 7.8% higher compared with the first six months of 2006 on the strength of higher prices. Despite this increase, hog receipts remained 3.2% below the previous five-year average.

The total number of hogs marketed by Canadian farmers was slightly above (+0.7%) the 2006 level, with 15.4 million hogs sold. Cash receipts from international exports of hogs jumped 16.1%, accounting for about 40% of the rise in hog receipts.

Receipts from supply-managed commodities (dairy products, poultry and eggs) increased 5.2% after a slight decline in 2006. Chickens and dairy products were the main factors behind this increase as their prices rose. Supply-managed commodities account for about 40% of total livestock receipts.

Program payments down from high levels

Farmers received $2.2 billion in program payments, a 14.2% decrease from the first six months of 2006, and 4.5% below the previous five-year average.

Crop insurance payments, to which producers contribute via premiums, were down 48.8% to $145 million, as a result of better growing conditions in 2006, particularly in Manitoba.

The phasing-out of the Grains and Oilseeds Program and the Farm Income Payment program also contributed significantly to the overall drop in payments.

The decline in program payments was cushioned by the new Cost of Production Payment program and higher Canadian Agricultural Income Stabilization program (CAIS) and CAIS-related program payments. Payments under CAIS and CAIS-related programs totalled $1.1 billion, up from the $837 million distributed during the same period in 2006.

The Cost of Production Payment program delivered $228 million of the $400 million committed under the program during the first half of the year. This program was designed to help address high production costs over the last four years.

Farm cash receipts
	January to June 2006	January to June 2007p	January–June 2006 to January–June 2007	April to June 2006	April to June 2007p	April–June 2006 to April–June 2007
	$ millions		% change	$ millions		% change
Total Farm cash receipts	18,103	19,869	9.8	9,000	9,976	10.8
Total market receipts1	15,482	17,619	13.8	7,929	9,062	14.3
All wheat2	1,166	1,903	63.2	723	1,147	58.6
Wheat excluding durum2	920	1,527	66.0	557	896	60.9
Durum wheat2	246	375	52.4	166	251	51.2
Barley2	186	285	53.2	92	125	35.9
Deferments	-89	-169	89.9	-49	-100	104.1
Liquidations of deferments	375	478	27.5	7	5	-28.6
Canola	1,127	1,508	33.8	556	812	46.0
Soybeans	274	402	46.7	144	170	18.1
Corn	317	478	50.8	147	207	40.8
Other cereals and oilseeds	176	253	43.8	82	122	48.8
Special crops	273	409	49.8	113	183	61.9
Potatoes	435	421	-3.2	220	208	-5.5
Floriculture and Nursery	1,131	1,152	1.9	787	802	1.9
Other crops	1,294	1,245	-3.8	853	838	-1.8
Total crops	6,663	8,366	25.6	3,676	4,519	22.9
Cattle and calves	3,117	3,222	3.4	1,464	1,541	5.3
Hogs	1,670	1,801	7.8	828	892	7.7
Dairy products	2,428	2,538	4.5	1,204	1,296	7.6
Poultry and eggs	1,212	1,291	6.5	618	672	8.7
Other livestock	391	401	2.6	139	142	2.2
Total livestock	8,819	9,253	4.9	4,253	4,543	6.8
Net Income Stabilisation Account	299	267	-10.7	23	8	-65.2
Crop Insurance	283	145	-48.8	33	22	-33.3
Income Disaster Assistance Programs	1,544	1,320	-14.5	639	616	-3.6
Provincial Stabilization	369	482	30.6	341	257	-24.6
Other programs	126	36	-71.4	36	11	-69.4
Total payments	2,621	2,249	-14.2	1,071	914	-14.7
p preliminary 0 true zero or a value rounded to zero 1. Total market receipts are the sum of crop and livestock receipts. 2. Includes Canadian Wheat Board payments. Note: Figures may not add up to totals because of rounding.

Provincial farm cash receipts
	January to June 2006	January to June 2007p	January–June 2006 to January–June 2007	April to June 2006	April to June 2007p	April–June 2006 to April–June 2007
	$ millions		% change	$ millions		% change
Canada	18,103	19,869	9.8	9,000	9,976	10.8
Newfoundland and Labrador	46	51	10.9	22	25	13.6
Prince Edward Island	208	193	-7.2	101	95	-5.9
Nova Scotia	226	233	3.1	93	96	3.2
New Brunswick	239	216	-9.6	118	107	-9.3
Quebec	3,170	3,317	4.6	1,817	1,775	-2.3
Ontario	4,288	4,470	4.2	2,310	2,345	1.5
Manitoba	1,736	2,139	23.2	703	1,077	53.2
Saskatchewan	3,198	3,712	16.1	1,399	1,747	24.9
Alberta	3,850	4,397	14.2	1,789	2,062	15.3
British Columbia	1,140	1,142	0.2	648	647	-0.2
p preliminary 0 true zero or a value rounded to zero Note: Figures may not add up to totals because of rounding.

Note to readers

Statistics Canada does not forecast farm cash receipts. These data are based on survey and administrative data from a wide variety of sources.

Farm cash receipts measure the gross revenue of farm businesses in current dollars. They include sales of crops and livestock products (except sales between farms in the same province) as well as program payments. Receipts are recorded when the money is paid to farmers before any expenses are paid.

Deferments represent sales from grains and oilseeds delivered by western producers, for which payments were deferred until the next year. Because these receipts are based on physical deliveries, any deferred payments are deducted from the farm cash receipts of the current calendar year and included when they are liquidated (see "Liquidations of deferments" in the farm cash receipts table).

Program payments include payments tied to current agricultural production and paid directly to farmers. However, the series does not attempt to cover all payments made to farmers, nor does it represent total government expenditure under all assistance programs. For example, the Canadian Farm Families Options Program announced in July 2006 is not included because it has been determined not to be business income for statistical purposes.

As a result of the release of data from the 2006 Census of Agriculture on May 16, 2007, estimates of farm cash receipts, operating expenses, net income, capital value and other data contained in the Agriculture Economic Statistics series will be revised, where necessary. These revisions will be announced in a future release of the series in The Daily. For more details on the Census of Agriculture, see the "2006 Census of Agriculture: Farm operations and operators" release published in The Daily on May 16.

Planting conditions varied in the Prairie Provinces with generally abundant to excessive levels of soil moisture this spring. As a result, crops in some areas were planted near the end of the seeding window for the 2007 growing season.

However, hot and dry conditions in July changed the production outlook with crop yields declining, due to reduced topsoil moisture conditions. The situation was most evident in south central and south western Saskatchewan, and in southern Alberta. At the time of this report, it is believed that rain could still help crops finish in many areas of the Prairie Provinces, where the production of all feed grains, canola and durum wheat is expected to rise from 2006. On the other hand, output of wheat excluding durum and flaxseed could fall. In some southern areas of Saskatchewan, the harvest has begun.

In Quebec and Ontario, dry conditions have been taking a toll on field crops. In spite of this, field corn production is still estimated to be a record in both provinces, the result of record harvested areas.

Wheat excluding durum production could fall

Prairie farmers reported that they expect to harvest 15.1 million tonnes of wheat excluding durum, a decline of 20.6% or 3.9 million tonnes from 2006. The five-year average production is 16.3 million tonnes. Harvested area is expected to fall 16.6%, and yield could drop 1.8 bushels per acre to 35.6 bushels per acre.

Production is expected to fall in all three Prairie Provinces, with declines ranging from 23.4% in Saskatchewan to 9.3% in Manitoba.

Durum wheat production nudges up

In the Prairies, durum production is expected to rise 6.1% to 3.5 million tonnes, an increase of 202,700 tonnes from 2006, the result of a strong increase in harvest area to 4.7 million acres. The five-year average production estimate is 4.4 million tonnes.

Note to readers

As a result of the release of data from the 2006 Census of Agriculture on May 16, 2007, estimates of field crop production have been revised, where necessary, to align with the census. Area, yield and production revisions have been made back to 2002. These data are available in CANSIM. Any required stock revisions will be released on September 11, 2007.

Provincially, durum production rose 9.0% in Saskatchewan to an estimated 2.9 million tonnes, while production in Alberta may fall 6.0% to 617,800 tonnes. The vast majority of Canadian durum wheat is grown in Saskatchewan.

Canola and flaxseed production move in opposite directions

Prairie canola production should rise this year, while flaxseed production is expected to fall.

Prairie canola production could rise 190,300 tonnes to an estimated 9.2 million tonnes, the result of an expected record harvest area of 14.2 million acres. The previous record was 14.1 million acres reported in 1994.

Manitoba production could be a record 2.0 million tonnes, exceeding last year's record of 1.8 million tonnes. A record harvested area of 2.8 million acres is responsible for the jump. Saskatchewan canola production should rise 13.6% to 4.2 million tonnes, the result of an increase in harvested area to a record 7.0 million acres. The previous record of 6.6 million acres was set in 1999. On the other hand, Alberta farmers reported a possible reduction in canola production of 12.7% to 3.0 million tonnes. This is the result of a drop in yield to 30.0 bushels per acre, an estimate below the five-year average of 31.4 bushels per acre.

In spite of the hot and dry conditions experienced in the Prairies, some experts point out that new canola seed varieties are more heat tolerant, reducing yield losses in adverse conditions.

Feed grain production should rise across the Prairies

The production of barley, oats and field peas should all rise in 2007 in the Prairie Provinces, the result of strong increases in harvested area.

Prairie barley production should rise to above-average levels this year, the result of an increased estimated harvest area and an average cut for silage. Production is estimated at 11.1 million tonnes, up 2.3 million tonnes from 2006, well above the five-year average of 9.7 million tonnes. Yields will continue to be above average at 54.6 bushels per acre. Farmers in all three Prairie Provinces reported that they expect production to increase in 2007.

Oat production in the Prairie Provinces should rise 34.7% to 4.6 million tonnes, an increase of 1.2 million tonnes from 2006. A rise in yield and a 25.0% increase in harvest area were responsible for the rise. The five-year production average is 2.9 million tonnes. Production increases should occur in all three Prairie Provinces, with gains ranging from 49.8% in Saskatchewan to 8.1% in Alberta.

Dry field pea production should rise 17.3% to 3.0 million tonnes, up 435,600 tonnes. A similar increase in harvested area to a record 3.6 million acres was responsible for the gain. The previous record was 3.1 million tonnes set in 2004.

Provincially, the results were mixed. Saskatchewan farmers reported a potential 25.0% increase in production to 2.3 million tonnes, the result of a record harvest area of 2.9 million acres. The previous record was 2.5 million acres set in 2005. On the other hand, farmers in Manitoba reported a 12.1% decrease in production to 91,000 tonnes, and Alberta farmers reported a potential 3.1% decline to 535,300 tonnes. These declines were due to anticipated decreases in yield in 2007.

Ontario, Quebec farmers should produce record grain corn, fewer soybeans

Farmers in Ontario and Quebec expect to produce a record amount of corn for grain in 2007, in spite of the excessive dryness being experienced in many areas.

Quebec farmers may produce a record 3.6 million tonnes of corn for grain this year, an increase of 33.3% or 900,000 tonnes. The previous record was 3.5 million tonnes set in 2003. A rise in expected yield of 13.3 bushels per acre and a record harvested area of 1.1 million acres were responsible.

In Ontario, corn-for-grain production could increase to a record 6.4 million tonnes, a gain of 9.1% or 533,400 tonnes. The previous record was 6.0 million tonnes set in 1998. This rise was the result of a 35.2% increase in harvested area.

Soybean production is expected to fall in both Quebec and Ontario.

In Quebec, production is forecast to drop 9.3% to 485,000 tonnes, the result of a comparable percentage drop in harvested area. The five-year average for Quebec soybean production is 453,000.

Ontario farmers expect production to drop 18.4% to 2.2 million tonnes, the result of a 9.8 bushel per acre drop in yield. The five-year average production estimate is 2.3 million tonnes.

WINNIPEG, MANITOBA- An innovative new weather network is sprouting from the Prairie soil.

The Canadian Wheat Board (CWB) and Pioneer Grain, a subsidiary of James Richardson International (JRI), have partnered with WeatherBug(R), the world's leading provider of local weather information, to kick off this major project as a tool for farmers and other businesses that rely on weather information. Parkland Agri Services, based in Didsbury, Alberta, is another significant project partner.

The project was conceived and initiated by the CWB's weather and crop surveillance unit. WeatherBug(R) is rapidly expanding its network in Canada and adding partners in numerous industries to grow a nationwide network of more than 1,000 weather stations across Canada.

"We are very pleased with this pro-competitive outcome, which puts an end to a long-running concern," said Commissioner of Competition, Sheridan Scott. "We believe these steps will promote competitive prices for farmers and grain handling companies in the Prairies and the ports," she said.