Thursday December 31 Ag News

Nebraska Corn Industry Faced Challenge, Capitalized on Opportunity in 2015

During 2015, Nebraska’s corn farmers saw another year of abundant production, but also faced some serious challenges in terms of commodity prices and federal policy. 

Leaders of the Nebraska Corn Board (NCB) and Nebraska Corn Growers Association (NeCGA) recently outlined their organizations’ 2015 programs and initiatives on behalf of Nebraska’s 23,000 corn farmers.

The Nebraska Corn Board manages the half-cent-per-bushel checkoff on all corn marketed and sold within the state.  The nine-member board is made up of Nebraska corn farmers who determine where those dollars are invested.

“In response to lower commodity prices, 2015 saw a high priority on building demand for corn and corn-related products—and on helping farmers improve efficiency, sustainability and profitability,” said Kelly Brunkhorst, executive director of the Nebraska Corn Board.  “At the same time, we continued to focus on our cornerstone issues of market development, research, education and promotion.”

Some key highlights of Nebraska Corn Board activity and investments during 2015 include:

•    Through a partnership with several other state agencies, the Nebraska Corn Board helped apply for a federal grant to increase the number of flex-fuel pumps across Nebraska.   The successful grant and matching funds will provide more than $3 million to establish new pumps in key markets that offer a wide range of American Ethanol blends.

•    Oversaw the launch of the new American Ethanol brand at fuel pumps, making Nebraska one of the first states in the nation to implement the consumer branding effort that emerged from the American Ethanol partnership with NASCAR.

•    Participated in continuing discussions with the nation’s auto manufacturers regarding thenext generation of automobile engines capable of operating on higher ethanol blends.

•    Worked with its national cooperators to increase exports of corn, ethanol, distillers grains, red meat and other value-added corn-based products.

•    In partnership with the University of Nebraska—Lincoln (UNL), the Nebraska Corn Board has helped fund research managing herbicide-resistant weeds, canopy sensor research for improved nitrogen fertilizer efficiency, the use of distillers grains in beef and dairy feed rations, and the development and release of the new Decide NOW marketing app.

•    Conducted a strategic survey of Nebraska corn farmers to help guide overall research priorities for Nebraska Corn Board investments.

•    Nebraska corn checkoff funds have also established a new Presidential Chair faculty position at UNL which will be focused on new uses for corn.  That position should be filled in early 2016.

•    The Nebraska Corn Board also supported a number of youth development initiatives including scholarships and internships with the Board’s major cooperators including the National Corn Growers Association, U.S. Grains Council and U.S. Meat Export Federation.

•    NCB also initiated its new Ag Champions competition which engaged Nebraska’s FFA chapters in becoming advocates for agriculture.

•    Promoted the responsible expansion of Nebraska’s livestock industry through research, partnerships and engagement with the Alliance for the Future of Agriculture in Nebraska (A-FAN).

•    Continued to provide financial support and expertise for Raising Nebraska, the award-winning exhibit on the Nebraska State Fairgrounds focused on helping consumers discover more about their food and the families who grow it.

The Nebraska Corn Growers Association is a membership association supported by dues-paying corn farmers and others who support the state’s corn industry.  NeCGA complements the activities of the Nebraska Corn Board by serving as the “boots-on-the-ground” grassroots advocacy organization for Nebraska’s corn farmers.

“NeCGA is the voice for Nebraska corn farmers in the State Capitol and on Capitol Hill,” said Larry Mussack, a Decatur, Nebr. corn farmer and president of the Nebraska Corn Growers Association.  “Our focus is on creating a positive policy and regulatory environment for corn farmers and developing and empowering the grassroots network needed to tell our story to decision-makers and the public. This past year certainly kept us busy on all fronts.”

During 2015, the Nebraska Corn Growers Association:

•    Continued to advocate for the interests of corn farmers as the Nebraska Legislature especially in the area of property tax relief.

•    Became highly engaged at the federal level on issues such as the Waters of the U.S., the Renewable Fuel Standard and trade promotion authority and the Renewable Fuel Standard.

•    Announced the formation of the new Central Plains local chapter, which involves corn farmers in Boone, Nance and Platte counties.

•   Spearheaded the development of a new "Nebraska Corn" specialty license plate in the state.

•    Sponsored training on grain engulfment prevention and response—and helped place five grain engulfment rescue tubes with first responders across the state.

•    Sponsored highly successful “Ethanol Night at the Races” events at four race tracks across Nebraska—and promoted renewable fuels at the NeCGA booth at Husker Harvest Days.

•    Sponsored thirteen Nebraska farmers, including farm couples, as part of its annual leadership event in Washington, DC, to inspire involvement and engagement in key issues and advocacy for the corn industry.

•    Sponsored its third Grassroots Advocacy Training workshop to help Nebraska corn farmers become informed and confident spokespersons for their industry.

•    Helped raise funds for the Food Bank of Lincoln and the Food Bank of the Heartland through golf tournaments and other activities.

Nebraska Corn was also well-represented on the national level this past year.  Alan Tiemann, a corn farmer from Seward, Nebr. and a farmer-director on the Nebraska Corn Board, is the current chairman of the U.S. Grains Council.   Jon Holzfaster, a corn farmer from Paxton, Nebr. and a farmer-director on the Nebraska Corn Board, is on the board of the National Corn Growers Association (NCGA).  Lynn Chrisp, a Kenesaw, Nebr. corn farmer and board member of the Nebraska Corn Growers Association, also serves on the NCGA board.



NC 2015 Year in Review

For Nebraska Cattlemen the year 2015 brought many challenging yet satisfying accomplishments.

The seedstock segment of our association saw record high production sales during the winter and spring months. Adequate rains across much of Nebraska allowed for herd expansion. Factors that took the cattle markets to all-time highs in 2014 corrected in 2015 putting the fed cattle and feeder cattle markets under pressure.

The conclusion of the 2015 Unicameral Session stemmed several studies that Nebraska Cattlemen engaged.  A balance between adequately funding schools and the tax burden agricultural producers are incurring as a result of rapidly accelerated valuation of production lands was elusive and will continue.  Many NC members were involved in studies on transportation this fall, testifying to challenges on weights of equipment deemed "implements of animal husbandry" and the enforcement of laws associated with these implements.

Understanding the importance of trade to our industry, Nebraska Cattlemen was busy reaching out to our trade partners. Leaders participated in trade missions led by Nebraska Gov. Pete Ricketts that included Mike Drinnin, Columbus, traveling to Europe in June and Barb Cooksley, Anselmo, traveling to Japan in September, allowed our story to be shared worldwide. Exports of U.S. beef reached a significant level in 2015 of more than $350 per head. These are real dollars that benefit all producers from our beef checkoff program. Livers typically selling at home for 75¢ a pound, marketed in Egypt for $7 to $8 a pound, this is a real example of how the beef checkoff and producers like Cooksley and Drinnin make a quantifiable difference.

Other NC members making a difference in 2015 were the efforts by Morrill County Cattlemen to improve the quality of the local school lunch program. Unfortunately, nationally established school lunch standards don't require high quality protein for students. The difference makers in the Morrill County Cattlemen worked with the Bridgeport superintendent to create a program for more beef in their school lunch diets. NC member Rob Marsh, Belvidere, was impressed by the efforts of Morrill County Cattleman, taking the idea to his county resulted in the creation the "Titan Beef Boosters". Gregg Wiedel, Hebron, and the rest of the NC Board voted to endorse the "Nebraska Beef to Schools" program that provides local beef to schools. The effort is growing into many schools across the state

The year-end has NC staff and leaders preparing for the 2016 legislative session. Members are looking to the seedstock production sales once again to be the bell weather for prices. Nebraska Cattlemen will continue working for Nebraska beef producers - pasture to plate in 2016.



2015 INCLUDED SEVERAL CHALLENGES FOR IOWA FARMERS

Iowa Secretary of Agriculture Bill Northey today provided a review of the top ag issues in Iowa in 2015.

“Many farmers saw the best ever yields in 2015 as it was a year of record production for both corn and soybeans in Iowa.  Unfortunately there were several challenges as well.  Iowa was at the center of the Highly Pathogenic Avian Influenza outbreak this spring.  Also, a significant drop in crop and livestock prices have created real challenges economically for farmers,” Northey said.  “However, farmers are optimistic and are looking forward to 2016 and new opportunities.”

Avian Influenza
The USDA has described the H5N2 Highly Pathogenic Avian Influenza outbreak of 2015 as the largest animal health emergency in U.S. history.  Nationwide there were 223 detections of HPAI from Dec. 19, 2015 through June 17, 2015.  There were 48 million birds in 21 states affected, but Iowa and Minnesota were the most severely impacted.

In Iowa, there were a total of 77 premises in 17 counties and 31.5 million birds were affected with the disease. This includes 35 commercial turkey flocks, 22 commercial egg production flocks, 13 pullet flocks, 1 chicken breeding flock, 1 mail order hatchery, and 5 backyard flocks.

As of early December, all HPAI quarantines have been lifted.  Iowa poultry producers are resilient, with all but one of the 72 commercial poultry farms that had quarantines on their facilities having begun the restocking process or are fully restocked.  To lift the quarantine, all sites completed the cleaning and disinfection process and had negative environmental tests.  They also underwent a 21 day fallow period following disinfection.

The Iowa response operated under a Unified Command involving the Iowa Department of Agriculture and Land Stewardship (IDALS) and USDA Animal and Plant Health Inspection Service (APHIS) Veterinary Services.

The Department had responsibility for maintaining safe movement of poultry and poultry products from farms that were affected by HPAI. IDALS issued a total of 3,700 movement permits to 42 states and the Virgin Islands. This includes 2,323 permits issued for movements within Iowa and 1,377 permits have been issued for movements out of state.

Iowa Water Quality Initiative
The Iowa Department of Agriculture and Land Stewardship is continuing to expand efforts to work with all Iowans to make water quality improvements.

Earlier this year Northey announced that 1,800 farmers committed $3.5 million in cost share funds to install nutrient reduction practices in each of Iowa’s 99 counties.  The practices that were eligible for this funding are cover crops, no-till or strip till, or using a nitrification inhibitor when applying fall fertilizer. Participants include 980 farmers using a practice for the first time and more than 830 past users that are trying cover crops again and are receiving a reduced-rate of cost share.  Farmer using cost share funding contribute 50% or more to the total cost of the practice.

In addition, 29 demonstration projects are currently located across the state to help implement and demonstrate water quality practices.  This includes 16 targeted watershed projects, 4 projects focused on expanding the use and innovative delivery of water quality practices and 9 urban water quality demonstration projects.  More than 100 organizations are participating in these projects.  These partners will provide $16.72 million dollars to go with the $11.11 million in state funding going to these projects.

Northey also highlighted that more than $325 million in state and federal funds have been directed to programs with water quality benefits in Iowa last year. This total does not include the cost share amount that farmers pay to match state and federal programs and funds spent to build practices built without government assistance.

More information about the initiative can be found at www.CleanWaterIowa.org.

Record Production, Economic Challenges
A near ideal growing season in much of the state saw Iowa farmers produce record corn and soybean crops.  The 2.49 billion bushel corn crop is 5 percent above the 2014 production and tops the previous record, set in 2009, by 4 percent.  A record yield of 189 bushels per acre is 11 bushels above last year and exceeds the previous record of 181 bushels per acre set in 2004 and 2009.

Iowa farmers produced a record 550 million bushels of soybeans, up 10 percent from 2014 and 5 percent above the previous record of 525 million bushels produced in 2005. The yield of 56 bushels per acre is 5.0 bushels above 2014 and 3.5 bushels above the previous record yield, set in 2005.

However, crop prices have continued to fall as a result of large crop production worldwide, softening global demand and a strong dollar.  Average statewide corn prices fell from $3.76 to $3.48 from Dec. 2014 to Dec. 2015 and statewide average soybean prices fell from $9.89 to $8.17 over the same period.

The livestock industry faced challenges as the prices they have received have fallen as well.  Fed cattle have seen the price drop from $161 per hundred weight down to $116. Hogs are down from $76 to $49 per hundred weight.

The tighter margins seen on the farm are starting to ripple through the economy.  Land prices are down 3.9 percent.  There have been several announcements of layoffs at manufactures, machinery providers, seed companies, and other business that serve the agriculture industry.

Despite the challenges, opportunities remain.  In general, exports remain strong.  Agricultural exports account for 10% of the U.S. exports and supports nearly one million jobs across the country.  Value added products such as ethanol and meat products have made up the largest share of agricultural exports at approximately 63%.

Iowa is a leading producer and exporter of agricultural products, ranking 2nd among the 50 U.S. states in the value of its agricultural exports in USDA’s most recent calculations. Iowa’s exports help boost farm prices and income, while supporting about 77,300 jobs both on the farm and in related industries such as food processing, transportation, and manufacturing.

To help continue to grow exports, Northey participated in trade missions with the Iowa Economic Development Authority, USDA and Iowa Agriculture organizations to Malaysia, the Philippines, China and Japan.



Current National Drought Summary
www.droughtmonitor.unl.edu

A large complex storm system produced copious amounts of precipitation in the Central and Southern US during this USDM week. The seasonably cold air behind the system mixed with the unseasonably warm, moist air that was entrenched across the east. This produced an unstable air mass kicking off heavy rains, thunderstorms, blizzards, tornadoes and historic flooding. Rainfall amounts on the warm side of the system were in excess of 10 inches, while some areas received more than 20 inches of snow on the cold side. The 7-day precipitation totals amounted to 800 percent of normal or greater for a large swath stretching from eastern Oklahoma, northwest Arkansas, much of Missouri, and Illinois. Portions of Alabama and Georgia also recorded far greater than normal precipitation amounts. The larger precipitation amounts missed areas in western Kansas, eastern Colorado, south Texas, Florida, the Desert Southwest, and areas in the Northern and High Plains. Record setting warm temperatures occurred across large portions of the eastern third of the US. Average temperature departures were in the range of 20-25 degrees above normal for the USDM week. Temperature anomalies were as much as 20 degrees below normal in the western third of the country.

Central
As the storm moved northeastward, a mixture of rain and blizzard like conditions affected the Central region. Heaviest rain amounts were in Missouri and Illinois where much of the area received at least 5 inches or more. Historic flooding was a concern along the banks of the Mississippi. In St Louis, the river was expected to crest at 44.8 feet – its second highest level ever recorded - only behind the great flood of 1993. For some places along the Mississippi and its tributaries, a record high crest is expected or has occurred. The storm left nearly a foot of snow in some locals. Iowa, Michigan and Wisconsin had several sites measuring 10 inches or more. A 1-cat improvement was made in southern Indiana where abundant precipitation has fallen during the last 30 days. D0 was removed from eastern Illinois and western Indiana. In Nebraska, D0 was trimmed back along the northwest corner based on recent percent of normal (>300 percent), but eradication was put on hold for one more week in the southwest. Kansas saw a slight expansion of D0 into Pawnee County based on 7 and 14 day percent of normals (<5%). DO was removed from the eastern portion of Kansas based on the recent precipitation more than double the normal.

Looking Ahead
During the next 5 days (December 31 – January 5) a system pumps Pacific moisture into southern Texas. Totals are projected to be 1-2 inches for the area. That same system skirts across the southern Gulf States and eventually makes its way into Florida by day 3. Precipitation totals are projected to exceed 1 inch. In the Northeast, lake effect snows are expected to ramp up during the first part of the period. On Day 4, a Pacific system is expected to bring much needed precipitation to most of California. This is followed by another Pacific system 2 days later. Much of the rest of the country is quiet during this 5-day period. Above average temperatures that have been present in the eastern half of the country are expected to give way to temperatures that are closer to average.

For the ensuing 7 days (January 6 - 12), odds favor above normal temperature in the east and below normal temperatures in the west. Chances are likely that precipitation will be above normal in the Southwest, South and parts of the Southeast. The probability of below normal precipitation exists for the Northwest, Great Lakes and Northeast regions. The outlook is for wetter- and warmer-than-normal weather for much of Alaska.



Crop Insurance Indemnities at $4.4 Billion for 2015 Crops

Crop insurance indemnities total $4.4 billion for 2015 crops as of Dec. 28, up from $3.45 billion at the end of November, according to Risk Management Agency (RMA) data.

The level of net acres insured for 2015 crops appears to have set a new record, reaching 297.151 million, ahead of the prior high-water mark of 296.079 million acres in 2013.

The loss ratio for the program currently stands at .45, up slightly from a month ago when it was .37. Indemnities will continue to rise so that loss ratio will also climb. But the lowest loss ratios going back to 2003 are .54 for 2007, .56 for 2010 and .58 for 2009. Rice is the only program crop with a loss ratio greater than 1.0 for 2015 crops (indemnities paid out exceed the premiums paid in) with a mark of 2.48. Flue-cured tobacco carries a level of 1.14.

The total payouts at $4.4 billion are down more than 50% from the 2014 crop total of $9.115 billion. Wheat remains the top payout on a by-crop basis, with indemnities of $1.155 billion compared to corn at $1.118 billion. The next closest crop is soybeans at $832 million.

The downturn in payouts under the program reflects fewer crop issues facing producers and lower prices for most crops compared to 2014 levels. The indemnity levels are likely to continue rising as we move into calendar 2016. At this stage a year ago for 2014 crops, indemnities stood at $5.212 billion and eventually rose to $9.115 billion. The potential is there for 2015 crops to be one of the lowest payout levels in recent years and give the program one of its lowest loss ratios in years.



Texas, N.M. Dairies Lose More Than 30K Cows

(AP) -- A dairy association official says that West Texas and eastern New Mexico producers continue to assess how many animals died in the winter storm last weekend, but the number will probably climb to more than 30,000 animals.

Texas Association of Dairymen executive director Darren Turley said Thursday that about 15,000 mature dairy cows died in the storm's primary impact area - from Lubbock west to Muleshoe and north to Friona. Turley says the number of younger animals killed by Winter Storm Goliath could be just as high.

Turley says officials with New Mexico State University's extension service told him the area around Clovis, New Mexico, lost an estimated 20,000 dairy cows.

The Texas producers are working with state environmental officials to find ways to dispose of the carcasses.



SUBWAY to Serve Only Cage-Free Eggs in North America

The SUBWAY submarine sandwich shops have been announcing numerous menu improvements over the past few years as part of in its journey to make its menu even better. The brand has reiterated its commitment to serve only eggs from cage-free layer hens across its 30,000 North American locations. The transition to cage-free eggs has already begun in select markets in the U.S. and Canada and will be completed across its 30,000 North American locations by 2025.

"Serving food that reflects our commitment to the humane treatment of animals has long been a priority to our brand," said Elizabeth Stewart, director of corporate social responsibility for the SUBWAY brand. "We know how important it is for consumers to feel confident that the food they eat is ethically sourced, and our customers care deeply about animal welfare. As a result of this commitment, not only can you come to our restaurants for a great-tasting, quality, affordable meal, but our customers will be able to enjoy delicious breakfast sandwiches made with cage-free eggs."

The company says their commitment builds on a number of other menu and ingredient improvements announced by the SUBWAY sandwich shop over the past year, including the brand's decision to remove all artificial colors, flavors and preservatives from North American menu items by 2017 and its plan to serve only antibiotic-free proteins in U.S. restaurants by 2025. The brand continues to monitor layer hen housing research to identify future, best-practice menu and ingredient solutions that meet the highest standards of animal welfare.