Thursday August 25 Ag News

NDA, AGRICULTURE: FRONT AND CENTER AT THE NEBRASKA STATE FAIR

Agriculture and the Nebraska State Fair go hand in hand. That’s why the Nebraska Department of Agriculture (NDA) is an active partner with the Nebraska State Fair.  NDA staff will be available throughout this year’s 10-day State Fair answering questions and assisting at the “Raising Nebraska” exhibit, protecting animal health with livestock inspections, coordinating the Elite Showman Competition, inspecting weights and measuring devices, and more.

“The Nebraska State Fair showcases everything that’s great about our state, and it all starts with our number one industry—agriculture,” said NDA Director Greg Ibach. “Even this year’s theme: ‘Grand Champions. Made in Nebraska.’ shines a spotlight on all those involved in agricultural and livestock events.”

One must-see area at the State Fair is “Raising Nebraska,” a series of exhibits that give people a chance to discover more about agriculture and the farmers and ranchers who grow our food. From operating a simulated combine, to taking a stroll on the interactive elevation map, visitors learn about the processes, products and innovations of the ag industry. There are even videos showing how different products like beef, pork, milk, wheat and eggs go from the farm to the grocery store and to the table. NDA is proud to work with UNL Extension on this popular exhibit.

NDA staff will be on hand at “Raising Nebraska” sharing information on various topics including: invasive pests, like the emerald ash borer; Nebraska’s Farmers Markets and available online resources; an exhibit to identify crops—many of which can be found planted around “Raising Nebraska:” and choosing the right cuts of meat for your favorite recipes. More information is available at www.statefair.org.

“Raising Nebraska” continues to add new features to its exhibition space. This year, a Living Soil exhibit focuses on soil health and the role it plays in agriculture and in urban and residential areas, as well.  This exhibit was partially funded by a grant from the Nebraska Environmental Trust.

Protecting animal health is another of NDA’s responsibilities at the State Fair. NDA Animal Health Protection staff inspects livestock entries before they enter the fairgrounds to ensure compliance with health regulations. Staff will also be onsite to address consumer and producer questions about animal disease traceability.

For those with questions about NDA’s Weights and Measures focus area, NDA will be discussing how Weights and Measures helps consumers and sellers alike in the marketplace by inspecting product packaging and measuring devices.

“The State Fair continues to be a great venue to support and promote agriculture,” said Ibach. “With the ‘Raising Nebraska’ exhibits and staff presentations, more and more people will be able to grow their knowledge of agriculture as well as the role of the Nebraska Department of Agriculture.”

The Nebraska State Fair runs from Aug. 26 to Sept. 5 in Grand Island.



National firm ranks NCTA among top 2 percent in U.S.

The Nebraska College of Technical Agriculture has been ranked ninth in the nation by a personal-finance website which measured colleges offering two-year academic programs.

In an analysis of 12 criteria evaluated by the firm, WalletHub, the University of Nebraska institution located at Curtis, Nebraska, was rated ninth out of 821 community colleges and two-year degree schools.

“We were pleased to receive word this week that NCTA has been recognized for the quality of its academic programs,” said Ron Rosati, NCTA dean. “It’s an honor to be ranked in the top 2 percent.”

WalletHub’s academic reviewers compared the 821 colleges on academic quality criteria such as graduation rate, student career outcomes, cost of in-state tuition, and student to faculty ratio.

“We are obviously very pleased to receive this recognition, especially since it comes after a string of other faculty and student awards received this past year,” Rosati noted.

During 2015-2016, those achievements included:
·         The 14 faculty at NCTA received 10 awards for teaching excellence;
·         Nine student teams earned Top 10 finishes in national academic competitions;
·         The Veterinary Technology program was reaccredited by the American Veterinary Medical Association;
·         NCTA was also reaccredited with high marks by the Higher Learning Commission; and
·         The college was ranked among the nation’s 150 best two-year colleges by the Aspen Institute.

“I believe these rankings are due to the skill and dedication of the college’s outstanding faculty and staff, as well as the passion and hard work of our students,” Rosati added. “It has been a real honor for me to serve at NCTA with these quality individuals.”

As part of the University of Nebraska system, NCTA has a unique mission in statewide delivery of academic programs emphasizing technical agriculture and workforce development.

Five academic divisions include animal science and agricultural education; agronomy, agricultural mechanics and irrigation technology; agribusiness management systems; general studies; and veterinary technology.

NCTA also offers international programs, dual credit courses for high schools, academic transfer programs for bachelor degrees, and on-line courses. See ncta.unl.edu or phone 1-800-3-CURTIS for details.



FY 2017 Exports Forecast Up $6.0 Billion to $133.0 Billion; Imports at $113.5 Billion

Fiscal 2017 agricultural exports are projected at $133.0 billion, up $6.0 billion from the revised fiscal 2016 forecast of $127.0 billion, largely due to higher exports of oilseeds and products, horticultural products, cotton, and livestock, dairy, and poultry. Oilseeds and product exports are up $2.7 billion to $31.0 billion, driven by record soybean export volume and higher unit values. Horticultural product exports are forecast to increase $1.4 billion, led by tree nut exports. Cotton exports are projected to rise $900 million due to sharply higher U.S. production and tighter foreign stocks. Exports of livestock, dairy, and poultry products are up $800 million, primarily due to higher poultry and dairy exports. Grain and feed exports are forecast unchanged at $29.3 billion, as higher wheat and corn exports offset reductions in sorghum. Agricultural exports to China are forecast $3.5 billion higher than fiscal 2016, primarily due to increased soybean, tree nuts, and pork exports. China is expected to edge out Canada and return as the largest U.S. market after spending 2016 in second place.

U.S. agricultural imports are forecast at $113.5 billion, $400 million higher than fiscal 2016. Increases in import values are expected for horticultural and tropical products, which more than offset reductions in livestock, dairy, and poultry products. The U.S. agricultural trade surplus is expected to increase by $5.6 billion in fiscal 2017 to $19.5 billion.

For fiscal 2016, the revised export forecast of $127.0 billion represents an increase of $2.5 billion from May. Imports are forecast $1.7 billion lower at $113.1 billion.



Vilsack on Latest Quarterly Export Forecasts for 2016 and 2017

Agriculture Secretary Tom Vilsack today issued the following statement on the first forecast for U.S. agricultural exports for fiscal year 2017 and a revised forecast for fiscal year 2016. Both forecasts indicate U.S. agricultural exports have begun to rally and will continue the record-setting pace that began in 2009.

"These numbers once again demonstrate the resiliency and reliability of U.S. farmers and ranchers in the face of continued challenges. The projected $133 billion in total exports for FY 2017 is up $6 billion from last forecast and would be the sixth-highest total on record. The United States' agricultural trade surplus is also projected to rise to $19.5 billion, up 40 percent from $13.9 billion in FY 2016. The United States has continued to post an agricultural trade surplus since recordkeeping began in the 1960s.

"The projected growth in exports in 2017 is led by increases in overseas sales of U.S. oilseeds and products, horticultural goods, cotton, livestock, dairy and poultry. And with a rise in global economic growth, global beef demand is expected to strengthen. While USDA continues working to eliminate the remaining restrictions on U.S. beef exports that were instituted by some trading partners as a result of the December 2003 BSE detection, U.S. beef exports have recovered. U.S. beef exports are expected to reach $5.3 billion in 2017, well above the $1.5 billion exported in FY 2004. This progress is due to USDA's work under the Obama Administration to eliminate BSE-related restrictions in countries around the world, including 16 countries since January 2015. 

"China is projected to return as the United States' top export market in 2017, surpassing Canada as the number one destination for U.S. agricultural goods.

"USDA also revised the forecast for FY 2016 exports to $127 billion, up $2.5 billion from the previous forecast. This would bring total agricultural exports since 2009 to more than $1 trillion, smashing all previous eight-year totals.

"Exports are responsible for 20 percent of U.S. farm income, also driving rural economic activity and supporting more than one million American jobs on and off the farm. The United States has the opportunity to expand those benefits even further through passage of new trade agreements such as the Trans-Pacific Partnership. Such agreements are key to a stable and prosperous farm economy, helping boost global demand for U.S. farm and food products, increasing U.S. market share versus our competitors, and ensuring that our farmers and ranchers have stable and predictable markets for the quality goods they produce."



USDA Livestock Slaughter - July 2016

Commercial red meat production for the United States totaled 3.87 billion pounds in July, down 4 percent from the 4.04 billion pounds produced in July 2015.

Beef production, at 2.02 billion pounds, was 1 percent below the previous year. Cattle slaughter totaled 2.48 million head, down 1 percent from July 2015. The average live weight was down 1 pound from the previous year, at 1,345 pounds.

Veal production totaled 5.6 million pounds, 19 percent below July a year ago. Calf slaughter totaled 37,700 head, up 3 percent from July 2015. The average live weight was down 65 pounds from last year, at 257 pounds.

Pork production totaled 1.82 billion pounds, down 8 percent from the previous year. Hog slaughter totaled 8.76 million head, down 7 percent from July 2015. The average live weight was down 2 pounds from the previous year, at 278 pounds.

Lamb and mutton production, at 11.4 million pounds, was down 12 percent from July 2015. Sheep slaughter totaled 170,100 head, 10 percent below last year. The average live weight was 134 pounds, down 4 pounds from July a year ago.

Commercial Red Meat Production By State 
                        (million pounds - % of July '15)
Nebraska ...........:     628.6            102      
Iowa ..................:     506.1             89      
Kansas ...............:     433.3             97      

January to July 2016 commercial red meat production was 28.3 billion pounds, up 2 percent from 2015. Accumulated beef production was up 4 percent from last year, veal was down 9 percent, pork was down slightly from last year, and lamb and mutton production was down 1 percent.



NCGA's Bowling Welcomes Ethanol Back to Virginia

National Corn Growers Association President Chip Bowling this week congratulated Green Plains Inc. on the grand opening of their Hopewell, Virginia ethanol production facility, and called for further expansion of renewable fuels on the East Coast.

"We are excited to see ethanol production back up and running in Virginia," said Bowling, who farms corn, soybeans, and sorghum just 100 miles away in Newburg, Maryland. "The Hopewell plant will give Mid-Atlantic farmers another market for their crop. It's good for the ag economy, and for consumers, who will now have access to renewable fuels grown and produced even closer to home. This is win-win."

The Hopewell ethanol facility, which opened in April 2014, was the first ethanol operation on the East Coast, producing ethanol from corn, barley, and other small grains. The facility stopped production in August 2015.

Green Plains Inc., an Omaha, Nebraska-based ethanol company, bought the facility last fall. The total production capacity of Green Plains' 14 ethanol plants is approximately 1.2 billion gallons of ethanol per year.

Bowling said the return of ethanol production to the East Coast could not come at a better time for the corn industry.

"Corn farmers across the country are expecting another bumper crop in 2016, at a time where prices have already fallen below production costs. The National Corn Growers Association is working together with industry and government to build demand for corn, and bring farmers back to profitability," said Bowling. "We need to keep investing in our ethanol infrastructure, especially here on the East Coast, to meet demand from consumers where they live and work."



Animal Food Industry Requests FDA Amend Part 11 Compliance for VFDs

The American Feed Industry Association and the National Grain and Feed Association today urged the U.S. Food and Drug Administration to remove the unnecessary regulatory burden that records required as part of the agency's revised Veterinary Feed Directive (VFD) program be maintained in accordance with the agency's onerous Part 11, Electronic Records; Electronic Signatures requirements.

FDA's VFD program serves as a major component of the agency's overall strategy to promote the judicious use of medically important antimicrobials in feed for food-producing animals. The VFD program requires the use of these drugs be under veterinary supervision so that they are used only when necessary for assuring animal health. The program also requires numerous records to be established and maintained by veterinarians, feed distributors and animal producers.

In a citizen petition, AFIA and NGFA requested that FDA revise Part 11 in a manner consistent with other recent agency decisions, in which the agency has determined that records do not need to be Part 11-compliant.

"With FDA's recent decision to exempt from Part 11 compliance on all documents related to the Food Safety Modernization Act for current good manufacturing practices, hazard analysis and preventive controls for animal and human food, it only makes common sense FDA do the same for VFDs," explained Richard Sellers, AFIA senior vice president of public policy and education.

The majority of feed mills that receive VFDs do not have the resources needed to implement and maintain computer systems in compliance with Part 11.

"In 1997, the cost of developing a computerized electronic records and signature system in full compliance with Part 11 was about $150,000 per facility. With inflation, that cost is roughly $225,000 today," said Dave Fairfield, NGFA senior vice president of feed services.

AFIA and NGFA said an exemption from the Part 11 requirements also would benefit FDA by enabling industry to provide documents to FDA for review in a more efficient and timely electronic format for facility inspections. 

FDA has 180 days to respond to AFIA and NGFA's request. But given the Jan. 1 implementation of the VFD requirements, the two organizations urged the agency to make the change prior to that date.



Farm Supply Co-ops and Other Ag Retailers Face Tighter Margins, Cyclical Challenges

Accounts receivable at farm supply co-ops and other ag retailers are growing and so are their challenges, according to a new report from CoBank. After an extended run of impressive financial performances, retailers are adjusting to a tougher economic environment accompanying the down-phase of the current ag commodity cycle.

Current headwinds are directly related to a sharp decline in commodity prices that has reduced farm income and tightened farm cash flows. A downturn in fertilizer prices and a spate of mergers and acquisitions in the seed and fertilizer industry have aligned to create adversity for ag retailers going forward.

“The drop in farm income over the past three years is the steepest decrease since the Depression,” says Tanner Ehmke, CoBank senior economist covering the grains, oilseeds and ethanol, and farm supply sectors. “Producer incomes have fallen more than 50 percent from 2013 to today and their debt-to-income ratio is on the rise. Not surprisingly, total accounts receivable for ag retailers posted an 11 percent gain for 2015, and that’s expected to grow in the year ahead due to ongoing farmer cash flow challenges.”

Farmers stretching existing credit lines, cutting costs and reducing pre-pay practices have retailers unsure about demand opportunities. Being more price sensitive creates additional competitive pressures on ag retailers as farmers explore new supplier sources in search of ways to lower expenses.

Fertilizer sales usually account for about half of ag retailers’ total revenue, so falling prices have made it difficult for them to maintain positive margins. Forecasts call for the slide to continue through 2017 as commodity values remain under significant pressure from abundant supplies in the United States and throughout the world.

Retailers are searching for every edge to maintain fertilizer sales and margins, forging new relationships and alliances with wholesalers where possible, while offering value-added services as a way to retain existing customers or entice new ones.

“The biggest challenge for ag retailers going forward will be to manage inventory to sync with demand,” notes Ehmke.

Lastly, seed and crop protection companies are experiencing a new wave of consolidation, creating ambiguity and insecurity about product offerings, prices and competition in the industry. Ag retailers are keenly concerned that with reduced competition there could be fewer seed and chemical brands to choose from, as well as reduced innovation in the industry that could result in fewer product offerings in the future. The consolidation wave could also leave ag retailers with less bargaining power, potentially reducing their ability to negotiate prices or rebates on volume sales.

Furthermore, many ag retailers face rising operating expenses—including payrolls and benefits—and higher depreciation costs following years of infrastructure investment and new facilities. While these upgrades were necessary, they now contribute to a drag on profits.

“On a positive note, it appears the drop in net farm income is slowing,” notes Ehmke. This is based off USDA’s projections for 2016 that call for a 2 percent reduction in net farm income year-over-year, compared to 2015 when net farm income dropped 38 percent year-over-year and 2014 when it dropped 27 percent.

“For ag retailers, the questions are, ‘What are you going to do to get through this rough patch? How will you adapt your cost structure and industry relationships while serving your customers as that valued partner?’” he asks.

“When we do get through this cycle, those businesses that have been able to adapt stand to benefit from a significant payout on the other side,” Ehmke concludes.



Algerian Market Returns To U.S. Corn, Shows Room For Development

U.S. corn sales to Algeria are making a strong showing in 2016, doubling 2014/2015 marketing year imports.

The U.S. Department of Agriculture's (USDA's) export sales report for Aug. 18, 2016, showed 527,000 metric tons (20.7 million bushels) of U.S. corn being exported to Algeria in the 2015/2016 marketing year, more than double sales last marketing year of 238,000 metric tons (9.3 million bushels).

It is one market being tracked by the U.S. Grains Council (USGC) as the new corn crop nears harvest and global market forces indicate potential for new pockets of demand for corn and other feed grain products.

“The U.S. is taking advantage of the poor crop and port congestion situation in South America and is recapturing market share that we haven’t seen in over a decade,” said Malek Djebaili, USGC consultant in Algeria. “The Council is working with this market opportunity and aggressively engaging the major importers in Algeria."

While Algeria is a relatively small market in terms of total U.S. corn exports - and overall exports to the region as a whole are on par with the last marketing year - it and neighbors in North Africa show potential for growth that USGC is seeking to capture through market development and targeted marketing on specific crops.

Among the Council’s coming programs are procurement courses for Algerian buyers of U.S. corn, scheduled to take place in Fargo, North Dakota, this September, and a workshop to continue to provide traders with the latest data on the U.S. corn crop and pricing, scheduled to take place in Algiers in the second week of October. In addition, the Council continues to push the Algerian government to lower the import duties on U.S. DDGS and corn gluten feed.



Oil Industry Report Ignores Climate Benefits of Biofuels

After the release of another report from API-funded biofuel critic John DeCicco, Emily Skor, CEO of Growth Energy, issued the following statement:

“Overwhelmingly, objective research demonstrates that biofuels are among the best tools we have to reduce greenhouse gas emissions and combat the effects of climate change. The latest attacks from John DeCicco and his sponsors in the oil industry reflect the same bogus arguments they have made for years, and policymakers aren’t going to be fooled. As the Department of Energy’s Argonne National Laboratory has demonstrated, ethanol is an earth-friendly biofuel that reduces greenhouse gas emissions by an average of 34 percent over their its lifecycle, while advanced biofuels can reduce emissions by 100 percent or more over conventional gasoline.

“This latest report is just another desperate attempt discredit the nation’s most successful clean energy program. The Renewable Fuels Standard is bringing cleaner, more affordable options to the gas pump, and those biofuels have helped to cut greenhouse gas emissions by 110 million metric tons every year – the equivalent of taking nearly 20 million vehicles off the road. Ethanol also has helped save consumers as much as $0.50 to $1.50 per gallon. More bogus climate science from the oil industry can’t change that.”



Soybean Growers from 11 States to Lead ASA's WISHH in 2016-17

American Soybean Association (ASA) President Richard Wilkins confirmed 15 soybean growers from 11 states to serve as ASA’s World Initiative for Soy in Human Health (WISHH) program committee in 2016-17. Officers are: Chairman Daryl Cates (IL), Vice Chair Levi Huffman (IN); Treasurer Stan Born (IL); and Secretary E.L. Reed (MO).

New WISHH Committee members include: Tim Bardole (IA); Roberta Simpson-Dolbeare (IL); Kurt Maurath (KS); and Dawn Scheier (SD). Returning members include the officer team as well as: Ryan Cahoon (N.C.); George Goblish (MN.); Jeff Lynn (IL); Steve Reinhard (OH); Jim Wilson (MI) and Art Wosick (ND). Keith Kemp (OH) serves as an ex-officio member representing the United Soybean Board (USB), along with U.S. Soybean Export Council (USSEC) Marketing Director Marypat Corbett.

ASA and WISHH praise the leadership of outgoing Chairman Lucas Heinen (KS) and Treasurer Monica McCranie (SD), as well as members Gary Berg (IL); Dean Coleman (IA); and John Heisdorffer (IA).

“We commend these soybean growers who lead WISHH’s important work that builds long-term international markets for U.S. soy by leveraging U.S. farmer investments with U.S. Department of Agriculture and other programs,” Wilkins said. “WISHH has a winning strategy that benefits both U.S. soybean growers and WISHH’s developing country partners, who make their nations more food secure by adding U.S. soy protein to their livestock feed rations and diverse human foods."

In the early 2000s, forward-thinking U.S. soybean leaders in multiples states launched WISHH as a way to create trade with developing countries, where a growing middle class would have the buying power to purchase protein foods and feeds. WISHH is focused on creating markets for soy where the need exists but the business does not. A recent example of this occurred in Pakistan, where WISHH helped create an aquaculture market that is contributing to demand for soy-based feed.

WISHH and the USSEC pave complementary trade routes that grow U.S. soy markets. In 2015, WISHH transitioned its Bangladesh operations to USSEC. That country’s annual U.S. soy purchases exceed $250 million. Due to demand for soy protein taking off in Pakistan, WISHH will continue to transition market development programs in that country to USSEC after Oct. 1, 2016.

According to U.S. Department of Agriculture (USDA) and other economic analysis, developing countries dominate world demand growth for agricultural products. USDA projects developing countries' demand for agricultural products will increase faster than their production. As a result, these countries will account for 92 percent of the total increase in world oilseed and meat imports in 2013-22.

WISHH is a trade-development organization. Since U.S. soybean farmers founded WISHH in 2000, it has worked in 24 countries to develop long-term markets for U.S. soybean farmers while fueling economic growth and value chain development. The WISHH program is managed from ASA’s world headquarters in St. Louis.