Monday November 9 Ag News

Nebraska Soybean Day and Machinery Expo Offers 2016 Growing Season Information

The 2015 Nebraska Soybean Day and Machinery Expo Dec. 17 will help soybean producers plan for next year's growing season.

The expo, which begins at 8:30 a.m. and concludes at 2:15 p.m., will be in the pavilion at the Saunders County Fairgrounds in Wahoo, said Keith Glewen, University of Nebraska-Lincoln Extension educator.

The expo opens with coffee, doughnuts and the opportunity to view equipment and exhibitor booths. Speakers start at 9 a.m.

Presenters include UNL researchers and specialists, Nebraska Soybean Board representatives, soybean growers and private industry representatives.

    David Kohl, professor emeritus agricultural economics, Virginia Tech University will present on "Megatrends in Agriculture and Global Economics, How it Impacts Nebraska Farmers."

    Tina Barrett, executive director, Nebraska Farm Business Association will discuss "Nebraska’s Farm Financial Outlook."

    John Frihauf, field biologist Sr., BASF, will present on "Management of Herbicide Resistant Weeds:  Combatting Waterhemp, Palmer Amaranth, and Marestail"

    Keith Glewen, Nebraska Extension educator, will present information on the Nebraska On-Farm Research Network in "Discovering Production Answers On Your Farm, What Could be New in Your Tool  Box?”

The expo also will include an update on the Nebraska Soybean Checkoff and association information.

Producers will be able to visit with representatives from seed, herbicide, fertilizer and equipment companies and view new farm equipment during a 30-minute break at 9:45 a.m.

The Saunders County Soybean Growers Organization requests that each participant donate one or more cans of nonperishable food to the food pantry.

Complimentary noon lunch will be served.

The program is free and registration will be at the door. For more information about the program or exhibitor information, call (800) 529-8030 or e-mail kglewen1@unl.edu.

This program is sponsored by Nebraska Extension in the university's Institute of Agriculture and Natural Resources, the Nebraska Soybean Board, Saunders County Soybean Growers Organization and private industry.



NEBRASKA COLLEGE OF TECHNICAL AGRICULTURE TO CELEBRATE 50 YEARS

    Modern roads and newer vehicles in the '50s and '60s helped pave the way for the first statewide technical agriculture college in Nebraska.

    The University of Nebraska School of Technical Agriculture was dedicated in November 1965. Its successor, the Nebraska College of Technical Agriculture, will celebrate 50 years as a college Nov. 13 with a public program and reception at 1:30 p.m., said Ron Rosati, NCTA dean.

    The institution that first opened its doors in 1913 in a large, red-bricked building in Curtis was originally a secondary school for rural students who didn't have high schools in their communities or counties.

    Many of the students who hailed from ranches and isolated, rural areas such as the vast Nebraska Sandhills attended high school for a semester at a time, returning to their family home for holiday and the summer break to work on the farm or ranch. During the school session, the out-of-town students lived in community homes at Curtis until the residential high school built dormitories.

    For five decades, the Nebraska School of Agriculture was a high school with peak attendance of 415 students in 1946-47. But the long travel times and distances to a high school gradually changed.

    "Once transportation had improved and communities had their own high schools, the need for a residential high school had lessened," said Gerald "Jerry" Huntwork of Curtis. He served as the high school agriculture instructor, then assistant dean at the college for nearly 34 years.

    "Beginning the college up here was an experience because we were all pioneers," he said. "This was something that hadn't been done before -- a responsibility, but also a huge honor to start the ag college."

    Political allies in the Nebraska Legislature, the Curtis Community Club, dedicated support staff and faculty in those early years and student enrollment were all keys to launching the college, said Stan Matzke Jr., who was the first superintendent. 

    He credits Horace Crandall for cultivating the idea. Crandall had served 43 years with the high school and was elected as a Nebraska legislator. He joined forces with Matzke's father, State Sen. Stan Matzke, and prepared a resolution for a technical agriculture college at Curtis. The effort sailed through the Legislature.

    Stan Matzke Jr., and his wife, Dorothy, moved to Curtis in June 1965 from Milford, where he had been with the Southeast Community College system.

    That first college had no state appropriation and survived with sheer grit and determination, and great loyalty and partnership with the high school leadership, Matzke said. He used leftover monies from the high school and garnered a matching grant from Federal Vocational-Technical Funds.

    The first two programs in 1965 were agricultural machinery (Mechanics I and II) and agricultural drafting (Drafting, Surveying and Soils), with 31 students enrolled. Two were out-of-state students from South Dakota and Illinois; the other 29 were Nebraskans. Later, drafting became known as ag conservation.

    The next two years, Matzke and Huntwork added programs in ag business, commercial horticulture, production ag and veterinary technology.

    Today, NCTA features programs in agbusiness management systems, agriculture production systems (animal science and agricultural education; agronomy, horticulture and ag mechanics) and veterinary technology systems.

    For information about NCTA, campus tours and 50th anniversary celebration events, contact the Dean's Office at 308-367-5200 or e-mail chauptman4@unl.edu.



U.S. Soybean Farmers Continue to Deliver on What Customers Want

International customers want high-quality, reliable products, and that’s what U.S. soybean farmers keep delivering – literally. In the most recent marketing year, the United States exported more than 2.3 billion bushels of U.S. soy, valued at more than $27 billion.

According to the U.S. Department of Agriculture, the final export total for the 2014/2015 marketing year, which ended September 30, includes more than 1.8 billion bushels of whole U.S. soybeans, meal from 552 million bushels of U.S. soybeans and oil from 172 million bushels. Exports accounted for 59 percent of U.S. soy demand this past marketing year.

“As a U.S. soybean farmer, I take pride in growing a high-quality product for my customers, whether they’re five miles away or 5,000,” says Bob Metz, United Soybean Board international opportunities target area coordinator, member of the U.S. Soybean Export Council board of directors and soybean farmer from Peever, South Dakota. “These numbers show not only how much our international customers rely on our soybeans, but also how much we rely on our customers.”

Top buyers of whole U.S. soybeans in 2014/2015 include:
• China: 1.084 billion bushels
• Mexico: 130 million bushels
• Japan: 78 million bushels

Top buyers of U.S. soybean meal include:
• Mexico: meal from 85 million bushels of U.S. soybeans
• Philippines: meal from 66 million bushels
• Canada: meal from 39 million bushels

Top buyers of U.S. soybean oil include:
• Mexico: oil from 46 million bushels of U.S. soybeans
• Dominican Republic: oil from 22 million bushels
• Peru: oil from 19 million bushels



NCBA’s Cattlemen’s College Set to Kick-off 23rd Year in San Diego
 
The National Cattlemen’s Beef Association’s Cattlemen’s College series will kick-off its 23rd year Jan. 26-27, 2016 in San Diego, Calif. Widely hailed as the premier educational event in the cattle industry, this series, sponsored by Zoetis, will feature speakers and live animal demonstrations that give cattlemen and women the tools to connect, learn and innovate.

“Cattlemen’s College is a great opportunity for producers from all parts of the country, all ages, and all operations to learn from leading industry experts and their fellow cattlemen and women,” said NCBA President Philip Ellis. “Never has producer education been more important in our industry, and if applied, the principals discussed in this program will add value to your operation.”

Cattlemen’s College will start off on Jan. 26, with an opportunity to listen to and question five of the most influential and dynamic experts in the beef industry through the session “Whole Herd Makeover: Cowboy Style.” Industry experts will include Dr. Dave Daley, Don Schiefelbein, Patsy Houghton and Tom Brink, with Dr. Tom Field moderating. Topics will range from expanding your cowherd with a vision, to genetics and animal health. This session will also feature live cattle demonstrations as these topics are explored in-depth. The day will conclude with a California Fresh Reception, showing off the bounty of California’s agricultural products and produce, sponsored by Zoetis.

Jan. 27 will start with a general session hosted by Dr. Robert Fraley, Executive Vice President and Chief Technology Officer for Monsanto, who believes the challenge to feed a growing world population will take collaboration and a greater focus on maximizing the use of resources. Dr. Fraley will share his outlook and thoughts on how agriculture will meet those goals. Following the general session and throughout the morning, attendees will have a choice of five key topic areas for hour-long breakout sessions. These breakouts will focus on cattle health, nutrition, hot industry topics, business development, production and how to seize future opportunities.

During lunch, attendees will have another chance to follow up with the day’s speakers and ask questions.

Early registration for Cattlemen’s College ends Jan. 4, 2016. Registration includes all Cattlemen’s College sessions and the reception. A complete schedule and registration information are available online at www.beefusa.org.



NCGA Disappointed in House Members for Signing Anti-Ethanol Letter

The National Corn Growers Association today expressed deep disappointment that Members of Congress from corn-producing states have asked the Environmental Protection Agency to reduce the volume of ethanol in the nation’s fuel supply.

“I’m disappointed to see Members of Congress turn their back on farmers and rural communities,” said Wesley Spurlock, First Vice President of the National Corn Growers and a farmer from Stratford, Texas.

“The Renewable Fuel Standard has been one of the most successful energy policies ever enacted. The RFS works. It has reduced our dependence on foreign oil. It has made the rural economy stronger. And it has been better for the environment. It’s puzzling that these Representatives would not want to support it,” said Spurlock.

In a letter to EPA Administrator Gina McCarthy dated November 4, House members ask the EPA to reduce the Renewable Volume Obligation (RVO), the amount of biofuels blended into the nation’s fuel supply – despite the fact that doing so would violate congressional statute. Electronic document properties have since revealed that the letter was drafted by an oil industry lobbyist, as reported by Bloomberg News.

“This letter has Big Oil’s fingerprints all over it,” said Spurlock. “The letter includes false attacks on ethanol that have been disproven time and again. The blend wall is a false construct. We have known from the beginning that eventually we would need higher blends of ethanol to meet the statutory requirements. That was the point: to replace fossil fuels with renewables. The oil industry doesn’t want to hear that. That’s why they have spent hundreds of millions of dollars trying to repeal the RFS, even to the point of having their lobbyists write this letter.”

Spurlock called on farmers, employees of the renewable fuels industry, and rural community leaders to contact their elected officials and make their voices heard.

“Ethanol is the backbone of the rural economy, and the elected officials who represent these communities need to hear from us. It’s up to us to tell them this is unacceptable and hold them accountable. Corn farmers are doing their part to feed and fuel America. It’s time for Congress to do their part and stand up for energy independence, clean air and strong rural communities.”

The following Members of Congress from corn-producing states signed the letter.

Colorado: Mike Coffman (R), Doug Lamborn (R)

Illinois: Robert Dold (R)

Kansas: Mike Pompeo (R)

Kentucky: Thomas Massie (R), Andy Barr (R)

Maryland: Andy Harris (R)

Michigan: Dan Benishek (R), Mike Bishop (R), Tim Walberg (R)

Missouri: Billy Long (R)

North Carolina: G. K. Butterfield (D), Robert Pittenger (R), David Rouzer (R), George Holding (R), Renee Elmers (R), Walter Jones (R), Virginia Foxx (R), Richard Hudson (R)

New York: John Katko (R), Christopher Gibson (R), Tom Reed (R), Chris Collins (R), Lee Zeldin (R), Richard Hanna (R), Peter King (R)

Ohio: Jim Jordan (R), Steve Chabot (R), Bradley Wenstrup (R)

Pennsylvania: Lou Barletta (R), Glenn Thompson (R), Ryan Costello (R), Joseph Pitts (R), Keith Rothfus (R), Charles Dent (R), Bill Shuster (R), Patrick Meehan (R), Tim Murphy (R), Scott Perry (R), Mike Kelly (R)

Texas: Marc Veasey (D), Henry Cuellar (D), Filemon Vela (D), Gene Green (D), Ruben Hinojosa (D), Joaquin Castro (D), Kevin Brady (R), Will Hurd (R), Randy Weber (R), Kay Granger (R), Randy Neugebauer (R), Roger Williams (R), Jeb Hensarling (R), Pete Session (R), Louie Gohmert (R), Lamar Smith (R), Mike Conaway (R), Sam Johnson (R), Kenny Marchant (R), Michael Burgess (R), John Culberson (R), Ted Poe (R), Blake Farenthold (R), Michael McCaul (R), Brian Babin (R), John Ratcliffe (R), Joe Barton (R), John Carter (R), Pete Olson (R), Mac Thornberry (R), Bill Flores (R)

Virginia: Scott Rigell (R), Robert Wittman (R), Morgan Griffith (R), Robert Hurt (R), Barbara Comstock (R), Dave Brat (R), Bob Goodlatte (R)

Wisconsin: Glenn Grothman (R), James Sensenbrenner (R)



Vilsack to Lead U.S. Delegation on Food and Agricultural Collaboration with Cuba

U.S. Agriculture Secretary Tom Vilsack will lead a delegation of U.S. Government officials traveling to Havana November 11-14, marking the first official U.S. Department of Agriculture visit to Cuba since 1961. Secretary Vilsack will be accompanied by U.S. Senator Jeff Merkley of Oregon and U.S. Representatives Terri Sewell of Alabama, Suzan DelBene of Washington and Kurt Schrader of Oregon.

“This trip will be an opportunity to support the Administration’s commitment to normalizing relations and empowering the Cuban people through bilateral agricultural engagement,” Vilsack said. “Food and agricultural goods are the dominant U.S. exports to Cuba and agriculture can serve as a bridge to foster cooperation, understanding and the exchange of ideas. Expanding markets for American agriculture has been a priority for this Administration, and relationships like the one we aim to build with Cuba are crucial to continuing the momentum we have seen over the past six years.”

The proposed schedule includes meetings with Cuban government officials in agriculture, foreign affairs, and food purchasing. The delegation also plans to visit port facilities, markets and cooperatives.



USDA, USGC, Growth Energy and RFA Participate in Clean Energy Mission to India

A team of U.S. ethanol industry representatives led by U.S. Department of Agriculture (USDA) Undersecretary for Farm and Foreign Agricultural Services Michael Scuse traveled to India last week to discuss opportunities for developing clean energy solutions, technologies and policies.

Seven representatives from the U.S. Grains Council (USGC), Growth Energy and the Renewable Fuels Association (RFA) as well as USDA participated in the mission, which was aimed at strengthening the level of cooperation and coordination between the ethanol industries of the two countries.

During a series of meetings that involved ethanol producers, oil companies and government officials, the U.S. participants received an in-depth look at the local industry’s situation and outlook. There were extensive discussions on India’s economy, political environment, energy sector and the role of government policy as a driver of the ethanol industry’s growth.

“Macroeconomic factors like population growth, continuing urbanization and increases in disposable income mean India is poised to use more gasoline and diesel fuels,” said USGC Past Chairman Ron Gray, who was part of the group representing the U.S. industry. “Given the negative effect that petroleum-based gasoline has on air quality, we feel that the expanded use of ethanol as an oxygenate can help India reduce smog and carbon emissions in this rapidly growing developing country, particularly in its cities.”

“America’s commitment to using ethanol in our fuel has made it possible for our nation’s busiest cities to dramatically reduce levels of smog and other harmful tail-pipe emissions,” said Ed Hubbard, general counsel for RFA. “By sharing our experiences with our friends here in India, we believe we can help them significantly improve the country’s air quality.”

India already imports sizeable amounts of industrial ethanol, mostly from the United States and Brazil. In 2014, India imported $86 million of industrial ethanol, with the United States being the largest supplier, and the Council expects India’s imports will rise sharply, reaching $150-200 million this year.

However, members of the U.S ethanol industry believe there is significant room for growth in India’s consumption of fuel ethanol. This view was echoed by India’s sugar and ethanol sectors during last week’s meetings, with the country seeking ways to increase their blend rates from current low levels as a means to improving air quality while supporting India’s sugar producers.

“India’s struggle to boost blend rates over the next decade is complicated by the likelihood that fuel demand will rise faster than the country’s production of ethanol produced from molasses, its primary feedstock,” said Jim Miller, vice president and chief economist for Growth Energy. “We believe that U.S. ethanol can play a significant role in India’s transition to higher blend rates until India’s ethanol production is able to accelerate sufficiently that it exceeds the growth in their fuel demand.”

The participants expected further engagement with their Indian counterparts in the coming years after analysis to determine how to best serve the particular needs of this market based on the information they gathered.

“With the overwhelming majority of India’s gasoline production coming from petroleum imports, increases in clean ethanol imports will come at the expense of carbon intensive petroleum imports, not India’s ethanol production," said Mike Dwyer, USGC chief economist. "We stand ready to work with India to help achieve this."



Brazilian Truckers Block Highways Monday
Alastair Stewart, DTN South America Correspondent

An independent group of truckers blocked highways in eight Brazilian states Monday in a repeat of the protests that delayed grain and meat transport earlier in the year.

As was the case in March and April, the blockades were most numerous Monday in the southern states of Parana, Santa Catarina and Rio Grande do Sul.

The movement is organized by the National Transport Command and doesn't count on the support of many truckers groups and haulage firms.

But the fact remains that it only takes a few truckers to block a road.

The freight industry has taken a big hit with the dramatic slowdown in the Brazilian economy, and the National Transport Command has a bucket list of demands to help ease the impact on truckers, including lower diesel prices, minimum freight rates, fixed salary scales and subsidized credit.

However, there appears to be an overtly political element to the latest strike with placards demanding that President Dilma Rousseff be ousted to the fore in many of the photos of blockades Monday.

The government argues that it made concessions on many of the truckers' demands following the last stoppage in April and, according to local news reports, it is hopeful the movement will peter out quickly.

A two-week stoppage in late February and early March heavily disrupted the flow of soybeans and chicken and pork to ports. A subsequent five-day stoppage in April didn't have a significant impact, though.

It is now low season for soybean exports, but Brazil is in the middle of exporting record volumes of corn. Ship lineups indicate over 5 million metric tons (mmt) of corn are due to be shipped this month.

Unlike in previous strikes, highways in Mato Grosso, the No. 1 soy state, remain unblocked.



USDA Reminds Dairy Producers of Nov. 20 Deadline

U.S. Department of Agriculture (USDA) Farm Service Agency (FSA) Administrator Val Dolcini today announced that almost half of all dairy farms in America have made their annual elections for 2016 coverage under the Margin Protection Program, and reminded producers who have not yet enrolled that they have until Nov. 20, to select coverage.

Established by the 2014 Farm Bill, the program provides financial assistance to dairy producers when the margin – the difference between feed costs and the price of milk – falls below the coverage level selected by the applicant.

“This safety net is not automatic, so producers must visit their local FSA office to enroll before Nov. 20,” said Dolcini. “Despite the best forecasts, the dairy industry is cyclical and markets can change quickly. This program is like any insurance product, where investing in a policy today will protect against catastrophic economic consequences tomorrow.”

FSA estimates that based on current participation rates, had the program existed before the 2014 Farm Bill, producers in 2009 would have invested $73 million in premiums and received $1.44 billion in financial protection during that historically weak market period.

Enrolled dairy operations must pay a $100 administrative fee annually to receive basic catastrophic coverage. Greater levels of margin protection are available for a higher premium, and provide expanded coverage based on historic dairy production. Once enrolled, producers can change their levels of coverage each year. Dairy producers are encouraged to review protection options online at www.fsa.usda.gov/dairy or by visiting their local FSA county office.



CWT Assists with 3.1 million Pounds of Cheese Export Sales

Cooperatives Working Together (CWT) has accepted 4 requests for export assistance on contracts to sell 3.144 million pounds (1,426 metric tons) of Cheddar, Gouda and Monterey Jack cheese to customers in Asia. The product has been contracted for delivery in the period from December 2015 through April 2016.

Year-to-date, CWT has assisted member cooperatives who have contracts to sell 54.545 million pounds of cheese, 25.671 million pounds of butter and 35.080 million pounds of whole milk powder to thirty-five countries on six continents. The amounts of cheese, butter and whole milk powder in these sales contracts represent the equivalent of 1.337 billion pounds of milk on a milkfat basis.

Assisting CWT members through the Export Assistance program, in the long-term, helps member cooperatives gain and maintain market share, thus expanding the demand for U.S. dairy products and the U.S. farm milk that produces them. This, in turn, positively impacts all U.S. dairy farmers by strengthening and maintaining the value of dairy products that directly impact their milk price.



Cattle Marketing and Price Risk Management
Brenda Boetel, Professor
Department of Agricultural Economics, University of Wisconsin-River Falls

In the last few weeks there has been much discussion regarding the direction of cattle prices.  Many analysts have explained that although short-term price forecasts are mixed, the long-term price outlook is bearish due to an increasing cattle herd.  Whether you are bearish or bullish on this coming week's short-term cattle price outlook, price volatility will be high and discussions on feedlot profitability will be commonplace.

Every cattle producer wants to sell their cattle at the highest price but feedlot profitability is dependent on more than just the output price.  Profitability for any cattle producer is contingent on good cattle marketing and price risk management skills.  In volatile and bearish markets those necessary skills will be put to the test.

Cattle marketing involves producing the type of cattle the market desires, marketing the animal at the best location and pricing at the correct time.  Feedlot profitability starts with the price paid for the feeder calf and is impacted by feed costs and management decisions.  Last week's feedlot margins decreased not only because of the decreased fed cattle price received upon finished sale, but also because the cattle finished were placed in June when the feeder cattle price was high. Thus producers earned small profit margins per animal through low returns and high costs. Additionally, this calculated feedlot margin assumes producers exercised no price risk management strategy and paid cash market prices for feeder cattle and feed.  However each individual producer likely has a very different feedlot margin.

Knowing your own cost of production is essential in determining profitability as these costs are likely a larger component of the margin than the final fed cattle price.  With cost of production knowledge, a producer can look for marketing opportunities that might otherwise not appear attractive. Additionally, producers can use the futures and options markets more effectively by finding hedging strategies to lock in price above costs of production.

Many producers have grown complacent with regards to cattle marketing and price risk management in the last couple years, as cattle prices continued to increase throughout 2014 while feed prices decreased.  Those who did explore different marketing and hedging strategies found that the risks didn't necessary warrant the high costs associated with changing marketing strategies.  With these recent market developments, now is the time to reconsider managing price risk and reviewing marketing strategies. Purchasing and selling decisions need to be made in a timely manner and without emotion.  Volatility in the cattle markets is not likely to decrease and the long-term outlook is bearish; however given good cattle marketing and price risk management, profitability is achievable. 



USDA to Provide Agricultural Credit Training, Expand Opportunities for Farmer Veterans and Beginning Farmers

The U.S. Department of Agriculture (USDA) today announced a partnership with the Farmer Veteran Coalition (FVC) to conduct agricultural credit training sessions in the Midwest for military veterans and beginning farmers and ranchers. States under consideration to host the workshops include Iowa, Illinois, Indiana, Michigan, Minnesota, Missouri, and Nebraska.

“USDA is excited to team up with the Farmer Veteran Coalition,” said Lanon Baccam, USDA Farm and Foreign Agricultural Service Deputy Under Secretary, and Military Veterans Agricultural Liaison. “These workshops will provide individuals interested in farming as a career, including military veterans, with methods to improve business planning and financial skills, and improve understanding of the risk management tools that can help small farm operations.”

Other partners include Niman Ranch a community network of more than 700 independent family farmers and ranchers, and the Farm Credit Council and the Farm Credit System, which provides loans, leases and financial services to farmers, ranchers and rural businesses across the United States. The workshops will also include assistance with credit applications and introductions to local or regional food markets.

To learn more about veterans in agriculture, visit www.usda.gov/veterans. Visit www.fsa.usda.gov/farmloans or your local Farm Service Agency (FSA) office to learn more about FSA's farm loan programs. To find your local FSA office, visit http://offices.usda.gov. More information also is available from the Farmer Veteran Coalition at www.farmvetco.org.



USDA Expands Investment in Water Conservation and Improvement in Nation's Largest Aquifer

Agriculture Secretary Tom Vilsack today announced USDA will invest $8 million in the Ogallala Aquifer Initiative (OAI) in Fiscal Year 2016 to help farmers and ranchers conserve billions of gallons of water annually while strengthening agricultural operations. The eight-state Ogallala Aquifer has suffered in recent years from increased periods of drought and declining water resources.

"USDA's Ogallala Aquifer Initiative helps landowners build resilience in their farms and ranches and better manage water use in this thirsty region," said Vilsack. "Since 2011, USDA has invested $74 million in helping more than 1,600 agricultural producers conserve water on 341,000 acres through this initiative."

The Ogallala Aquifer is the largest aquifer in the U.S. and includes nearly all of Nebraska and large sections of Colorado, Kansas, New Mexico, Oklahoma, South Dakota, Texas, and Wyoming. It is the primary water source for the High Plains region. Covering nearly 174,000 square miles, it supports the production of nearly one-fifth of the wheat, corn, cotton and cattle produced in the U.S. and supplies 30 percent of all water used for irrigation in the U.S.

Water levels in the region are dropping at an unsustainable rate, making targeted conservation even more important. From 2011 to 2013, the aquifer's overall water level dropped by 36.0 million acre-feet, according to the U.S. Geological Survey.

USDA's Natural Resources Conservation Service (NRCS) supports targeted, local efforts to conserve the quality and quantity of water in nine targeted focus areas through the OAI, adding two new focus areas for fiscal year 2016, while continuing support for seven ongoing projects. These projects include improving the efficiency of irrigation systems; building soil health by using cover crops and no-till practices that allow the soil to hold water longer and buffer roots from higher temperatures; and implementing prescribed grazing to relieve pressure on stressed vegetation.

The new focus areas include:

Middle Republican Natural Resource District in Nebraska: The project addresses groundwater quantity and quality concerns. The focus will be in areas where groundwater pumping contributes to high levels of stream flow depletion. Priority will be given to areas where groundwater pumping contributes to more than 48 percent of the overall aquifer depletion rate. The project will enable participants to voluntarily implement practices to conserve irrigation water and improve groundwater quality.

Oklahoma Ogallala Aquifer Initiative: This project will help landowners implement conservation practices that decrease water use. It includes an educational component that will educate citizens about water conservation and conservation systems. These systems include converting from irrigated to dryland farming and conservation practices that improve irrigation water management; crop residue and tillage management; nutrient and pesticide management, and grazing systems; and playa wetland restorations. The targeted area includes places where great amounts of water are consumed. Focal areas will be heavily-populated municipalities in the aquifer region.

NRCS analysis of Environmental Quality Incentives Program (EQIP) conservation projects in the region, including those implemented through OAI, estimated reduced water withdrawals of at least 1.5 million acre-feet, or 489 billion gallons of water, from 2009 through 2013 and an energy savings equivalent of almost 33 million gallons of diesel fuel due to reduced irrigation.

With the growing demand for water and drought conditions plaguing the West, NRCS is working with farmers and ranchers to help them implement proven conservation solutions on targeted landscapes to improve the quality of water and soil, increase water supplies, increase the infiltration of water into the ground, and make lands more resilient to drought.

This investment in the Ogallala region expands on USDA's substantial efforts to help producers address water scarcity and water quality issues on agricultural lands. Between 2012 and 2014, across the United States, NRCS invested more than $1.5 billion in financial and technical assistance to help producers implement conservation practices that improve water use efficiency and build long term health of working crop, pasture, and range lands. These practices include building soil health by using cover crops and no-till, which allow the soil to hold water longer and buffer roots from higher temperatures; improving the efficiency of irrigation systems; and implementing prescribed grazing to relieve pressure on stressed vegetation.



AgriBank Reports Third-Quarter 2015 Financial Results

Today St. Paul-based AgriBank announced financial results for the third quarter of 2015 with continued strong net income and credit quality, and robust liquidity and capital.

Highlights:
-    Stable net interest income: While net interest income from the core lending business remained relatively stable, net income decreased $59.5 million, or 14.1 percent, to $362.8 million for the nine months ended September 30, 2015. The decrease was primarily driven by lower mineral income due to continued low oil prices and reduced mineral leasing activity.
-    Strong credit quality: Loan portfolio credit quality remained strong. Acceptable loans stood at 99.7 percent.
-    Robust liquidity and capital: Cash and investments totaled $15.6 billion at September 30, 2015, compared to $16.4 billion at the end of last year. End-of-the-quarter liquidity was 153 days, well above requirements established by the Farm Credit Administration (FCA), the Bank’s independent regulator. Regulatory capital ratios also remained above FCA minimums, with capital of $5.1 billion.

“While U.S. net farm income is expected to decline in 2015 compared to last year, AgriBank’s continued strong credit quality in the third quarter reflects the strong liquidity and equity positions of many borrowers,” said Bill York, AgriBank CEO. “In the current agriculture efficiency cycle — marked by lower commodity prices — AgriBank and affiliated Farm Credit Associations are well-positioned to continue supporting rural communities and agriculture, just as we have for nearly 100 years."

Year-to-date 2015 Results of Operations
Net income decreased $59.5 million, or 14.1 percent, to $362.8 million for the nine months ended September 30, 2015.

Net interest income remained stable at $386.1 million for the nine months ended September 30, 2015, compared to $390.6 million for the same period in 2014. The decrease in net interest income was primarily attributable to increased interest expense on System-wide debt securities and, to a lesser extent, lower interest rates earned on our retail loan portfolio due to increased competitive pressures. These impacts on net interest income were substantially offset by growth in loan volume year-over-year.

Provision for loan losses was $5.0 million for the nine months ended September 30, 2015, compared to $2.5 million for the same period in 2014.

Non-interest income decreased to $70.5 million for the nine months ended September 30, 2015, compared to $114.5 million for the same period in 2014. This decrease was primarily driven by lower mineral income due to continued low oil prices and a reduction in mineral leasing activity and, to a lesser extent, a decrease in non-recurring gains on sales of available-for-sale investment securities during 2015.

Third Quarter 2015 Results of Operations
Third quarter 2015 net income was $121.1 million, down from $155.8 million for third quarter 2014. Net interest income was stable, but net income was negatively impacted primarily by a reduction in mineral income and a decrease in non-recurring gains on sales of available-for-sale investment securities.

Loan Portfolio
Total loans increased to $80.0 billion, primarily due to increases in loans to affiliated Associations, partially offset by paydowns on real estate mortgage loans purchased through the Asset Pool program. The strong liquidity and equity positions of many borrowers are reflected in the continued favorable credit quality of AgriBank’s loan portfolio. The portfolio had 99.7 percent acceptable-rated loans at September 30, 2015, unchanged from December 31, 2014. Acceptable loans represent the highest quality assets. Credit quality has been steadily improving since 2009 and remains consistent with December 31, 2014; however, these strong positions are expected to revert to more normal levels over time as the commodity price outlook remains challenging.

The U.S. Department of Agriculture’s (USDA) Economic Research Service projects U.S. aggregate net farm income (NFI) to significantly decline from the revised final estimate of $91.1 billion in 2014 to a forecasted $58.3 billion in 2015. The overall decline in 2015 NFI is driven by lower receipts for both crops and livestock primarily due to lower expected prices. Despite the expected significant decline in 2015 farm incomes, the U.S. farm sector entered 2015 in perhaps its strongest financial condition in over 50 years.

Relative to recent history, the outlook for most crop producers looks challenging over the next five years, with most forecasters projecting corn and soybean prices staying at or near break-even levels. Producers may benefit from USDA commodity title programs under the Agricultural Act of 2014 which could be triggered by lower commodity prices. These programs, combined with disciplined risk management practices and the generally strong financial condition of borrowers comprising the District’s crop portfolio, are expected to help mitigate the impact of lower margins.

Capital Resources and Liquidity
Total capital increased $185.9 million during the period to $5.1 billion, driven primarily by net income, partially offset by patronage and dividends.

Cash and investments totaled $15.6 billion at September 30, 2015, compared to $16.4 billion at the end of last year. The Bank’s end-of-the-period liquidity position represented 153 days coverage of maturing debt obligations which supports our operational demands and is well above the 90-day minimum established by AgriBank’s regulator.

About AgriBank
AgriBank is one of the largest banks within the national Farm Credit System, with more than $95 billion in total assets. Under the Farm Credit System’s cooperative structure, AgriBank is primarily owned by 17 affiliated Farm Credit Associations. The AgriBank District covers America’s Midwest, a 15-state area stretching from Wyoming to Ohio and Minnesota to Arkansas. About half of the nation’s cropland is located within the AgriBank District, providing the Bank and its Association owners with expertise in production agriculture. For more information, visit www.AgriBank.com.



New biofuels eliminate need for blending with petroleum fuels
U.S. Energy Information Administration

A new type of renewable diesel fuel is meeting the growing demand for renewable biofuels, which is driven by biofuel mandates and customer demands for higher quality. Unlike other biofuels, hydroprocessed esters and fatty acids (HEFA) fuels are nearly indistinguishable from their petroleum counterparts. Worldwide, more than a billion gallons of HEFA fuels were produced in 2014.

HEFA fuels are hydrocarbons rather than alcohols or esters. Hydrocarbons from nonpetroleum sources are known as drop-in fuels because they are nearly identical to comparable petroleum-based fuels. During the refining process, the oxygen present in the alcohols and esters is removed, leaving only hydrocarbons. HEFA fuels are the most common drop-in biofuels; they can be used in diesel engines without the need for blending with petroleum diesel fuel. Currently, HEFA fuels are approved by ASTM International for use in jet engines at up to a 50% blend rate with petroleum jet fuel.

The most common HEFA biofuel production to date has been a diesel replacement fuel alternately marketed as hydrotreated vegetable oil (HVO) abroad, or as renewable diesel in the United States. HEFA fuels are produced by reacting vegetable oil or animal fat with hydrogen in the presence of a catalyst. The equipment and process are very similar to the hydrotreaters used to reduce diesel sulfur levels in petroleum refineries. There are currently 10 plants worldwide that produce renewable diesel, one of which is ENI's former petroleum refinery in Venice, Italy. Total is planning to convert its La Mede, France, refinery to HVO production, and four additional renewable diesel projects are being developed by other producers. Finnish Neste is the world's largest producer of renewable diesel. Other major producers are Italy's ENI, U.S.-based Diamond Green Diesel, and Swedish refiner Preem.

Beyond diesel, another outlet for HEFA fuels using similar technology is biojet fuel, which can currently be blended with petroleum jet fuel in proportions up to 50%. As with any alternative jet fuel, HEFA biojet has to meet stringent specifications that ensure it will perform under a wide range of conditions. One potential consumer for this fuel is the U.S. Department of Defense, which intends to use biojet in its JP-8 jet fuel. JP-8 is a versatile fuel used in military vehicles, stationary diesel engines, and jet aircraft. This use of a common fuel simplifies logistics. There is also civilian interest in nonpetroleum jet fuel. Alaska Airlines, KLM, and United Airlines have demonstrated the use of HEFA biojet fuel on commercial flights since 2011.