Thursday July 20 Ag News

Rural Mainstreet Index Experiences Biggest Fall in Almost Nine Years:
Drought Conditions Weighing on Region’s Farms

After rising to growth neutral for two straight months, the Creighton University Rural Mainstreet Index fell below the 50.0 threshold for July according to the latest monthly survey of bank CEOs in rural areas of a 10-state region dependent on agriculture and/or energy.  

Overall: The index, which ranges between 0 and 100, tumbled to 40.7, its lowest level since November of last year, and down from 50.0 in June.

“This is the largest one-month decline we have recorded since November 2008, or in the middle of  the national recession, “said Ernie Goss, Jack A. MacAllister Chair in Regional Economics at Creighton University's Heider College of Business. “Drought conditions in portions of the region, combined with weak grain prices, negatively affected economic conditions, and the economic outlook for a large share of bank CEOs this month,”

Farming and ranching: The farmland and ranchland-price index for July sank to 36.6 from June’s 40.0. This is the 44th straight month the index has fallen below growth neutral 50.0.

This month, and in July 2016, bank CEOs were asked to project the percentage of grain farmers likely to experience negative cash flows for 2017. On average, bankers expect 15.1 percent of grain farmers to suffer negative cash flows for 2017. This is an improvement from last year when 19.1 percent anticipated negative cash flows for 2016.  

The July farm equipment-sales index fell to 20.0 from 26.2 in June. This marks the 47th consecutive month the reading has dropped below growth neutral 50.0.
 
Below are the state reports:
Nebraska: The Nebraska RMI for July sank to 42.1 from June’s 51.4. The state’s farmland-price index declined to 37.5 from 40.9 in June. Nebraska’s new-hiring index stood at a strong 62.5, but down from 67.4 in June.

Iowa: The July RMI for Iowa tumbled to 41.7 from 50.5 in June. Iowa’s farmland-price index for July dipped to 37.3 from 40.5 in June. Iowa’s new-hiring index for July remained healthy at 60.7, though it was down from June’s 64.3.

Each month, community bank presidents and CEOs in nonurban agriculturally and energy-dependent portions of a 10-state area are surveyed regarding current economic conditions in their communities and their projected economic outlooks six months down the road. Bankers from Colorado, Illinois, Iowa, Kansas, Minnesota, Missouri, Nebraska, North Dakota, South Dakota and Wyoming are included. The survey is supported by a grant from Security State Bank in Ansley, Neb.

This survey represents an early snapshot of the economy of rural agriculturally and energy-dependent portions of the nation. The Rural Mainstreet Index (RMI) is a unique index covering 10 regional states, focusing on approximately 200 rural communities with an average population of 1,300. It gives the most current real-time analysis of the rural economy. Goss and Bill McQuillan, former chairman of the Independent Community Banks of America, created the monthly economic survey in 2005.



ACE conference breakout sessions explore key industry issues
The American Coalition for Ethanol (ACE) announces more details on the breakout sessions for this year’s 30th annual conference coming up Aug. 15-17 in Omaha. Prospective attendees are being urged to register online by Aug. 1 and make hotel reservations by July 25 to get the best conference rates.

The breakout sessions will be held concurrently in three rounds on the afternoon of Wednesday, Aug. 16, following the morning general session panels and keynote address from Nebraska Gov. Pete Ricketts. The breakout sessions reiterate this year’s conference theme of “Tested. Proven. Driven.”

“Our conference theme is Tested. Proven. Driven. which describes not just our molecule but the people of the ethanol industry as well,” said Brian Jennings, ACE executive vice president. “Time and time again, our industry (and our product) rises above the many tests and hurdles in our path.   We’re committed to the success of farmers, rural communities and to making ethanol the consumer fuel of choice.”

Breakout sessions tailored to ethanol plant boards of directors are included in the conference agenda. Kcoe Isom will lead one session providing boards of directors with a framework for understanding their roles and responsibilities. Another discussion, led by Ascendant Partners, will focus on succession planning and retention for ethanol company boards. Additionally, CPA firm Eide Bailly will cover best practices and safeguards to protect shareholders and ensure ethanol plants are protected from fraud.

New technology and efficiency improvements are other topics to be discussed during the ACE conference breakout panels. Fluid Quip Process Technologies will share opportunities for diversification in the ethanol industry. Representation from ICM Inc. will shed light on plant efficiency improvements that focus on creative solutions to move toward product diversification for long-term profitability. Christianson’s biofuels consultants will illustrate the industry’s progress by sharing trends in ethanol efficiencies using data from their biofuels benchmarking program.

Two of this year’s breakout sessions will cover retail-related subjects. A panel of two ethanol plants, Glacial Lakes Energy and Siouxland Ethanol, will provide examples of how well-executed retail promotions can successfully introduce higher ethanol blends. Also, fuel marketers Bosselman Enterprises and Husker Ag will share how ethanol producers and fuel marketers are improving the availability of competitively priced ethanol through direct marketing.

“The agenda is focused on what is being done to grow demand for ethanol here at home, through E15 and flex fuels, and around the world, based on ethanol’s octane and carbon reduction value,” Jennings said.

To learn more about the breakout sessions and conference agenda, click here... https://ethanol.org/events/conference. 



IOWA FARMERS ENCOURAGED TO APPLY NOW FOR COST-SHARE FOR COVER CROPS, NO-TILL/STRIP-TILL AND NITRIFICATION INHIBITOR

Iowa Secretary of Agriculture Bill Northey today reminded Iowa farmers that funds are available to help install practices focused on protecting water quality.  Practices eligible for this funding are cover crops, no-till or strip till, or using a nitrification inhibitor when applying fertilizer.

The cost share rate for first-time users of cover crops is $25 per acre, no-till or strip till are eligible for $10 per acre and farmers using a nitrapyrin nitrification inhibitor when applying fall fertilizer can receive $3 per acre. Farmers are eligible for cost share on up to 160 acres.

First-time users that apply by July 28 will be the first applications funded.  First-time users that apply after July 28 will still receive priority consideration, but funds will also be made available to farmers that have used cover crops in the past for cost share assistance at $15 per acre.

“We already have $1.8 million in applications from more than 800 farmers interested in trying a new practice on their farm to better protect water quality. However, we do have some funds available, both for first time users and those interested in trying cover crops again. I hope interested farmers will contact their local Soil and Water Conservation District soon to learn more about the assistance that is available,” Northey said.

Farmers are also encouraged to visit their local Soil and Water Conservation District office to inquire about additional opportunities for cost share funding through other programs offered at their local SWCDs.

The cost share assistance was announced on May 11.  Since then, the Governor has signed into law $10.575 million to support the Iowa Water Quality Initiative.

In the 4 years this statewide program has been available over 4,800 farmers, with participants in each of Iowa’s 99 counties, have put in nutrient reduction practices on more than 455,000 acres.  The state provided about $9.3 million in cost share funding to help farmers try a water quality practice and Iowa farmers provided more than $9.3 million of their own resources to support these water quality practices.



USDA Opens More Land for Emergency Haying and Grazing

Today, Agriculture Secretary Sonny Perdue announced that the U.S. Department of Agriculture (USDA) is authorizing the use of additional Conservation Reserve Program (CRP) lands for emergency grazing and haying in and around portions of Montana, North Dakota and South Dakota affected by severe drought. USDA is adding the ability for farmers and ranchers in these areas to hay and graze CRP wetland and buffer practices.

“We are working to immediately address the dire straits facing drought-stricken farmers and ranchers,” said Perdue. “USDA is fully considering and authorizing any federal programs or related provisions we have available to meet the immediate needs of impacted producers.”

For CRP practices previously announced, including those authorized today, Secretary Perdue is allowing this emergency action during and after the primary nesting season, where local drought conditions warrant in parts of Montana, North Dakota and South Dakota that have reached D2, or “severe”, drought level or greater according to the U.S. Drought Monitor. This includes counties with any part of their border located within 150 miles of authorized counties within the three states, and may extend into Idaho, Iowa, Nebraska, Minnesota and Wyoming. All emergency grazing must end Sept. 30, 2017 and emergency haying must end Aug. 31, 2017.

The Secretary said that epic dry conditions, as high as D4 in some areas, coupled with an intense heatwave have left pastures in poor or very poor condition resulting in the need for ranchers to, at best, supplement grain and hay and at worst, sell their herds.

Landowners interested in emergency haying or grazing of CRP acres should contact the Farm Service Agency (FSA) office and meet with the local Natural Resources Conservation Service (NRCS) staff to obtain a modified conservation plan to include emergency haying/grazing.  Individual conservation plans will take into consideration wildlife needs.  CRP participants are reminded that a certain percentage of fields must be left unhayed or ungrazed.

Additional information about the counties approved for emergency haying and grazing and the eligible CRP practices in this area is available at www.fsa.usda.gov/emergency-hayandgraze.



Record Total Red Meat and Pork Production for June

Commercial red meat production for the United States totaled 4.35 billion pounds in June, up 3 percent from the 4.23 billion pounds produced in June 2016.

Beef production, at 2.28 billion pounds, was 4 percent above the previous year. Cattle slaughter totaled 2.86 million head, up 6 percent from June 2016. The average live weight was down 13 pounds from the previous year, at 1,321 pounds.

Veal production totaled 6.3 million pounds, 1 percent below June a year ago. Calf slaughter totaled 40,400 head, up 7 percent from June 2016. The average live weight was down 23 pounds from last year, at 268 pounds.

Pork production totaled 2.05 billion pounds, up 2 percent from the previous year. Hog slaughter totaled 9.87 million head, up 3 percent from June 2016.  The average live weight was down 1 pound from the previous year, at 279 pounds.

Lamb and mutton production, at 12.4 million pounds, was down 7 percent from June 2016. Sheep slaughter totaled 188,000 head, 4 percent below last year. The average live weight was 132 pounds, down 4 pounds from June a year ago.

By State  (million pounds, - % of June '16)
Nebraska ........:         687.6            100      
Iowa ...............:         577.8            102      
Kansas ............:         499.6            106      

January to June 2017 commercial red meat production was 25.4 billion pounds, up 4 percent from 2016. Accumulated beef production was up 5 percent from last year, veal was down 2 percent, pork was up 3 percent from last year, and lamb and mutton production was down 5 percent.



NMPF Applauds Senate Appropriations Leaders on Dairy Safety Net Improvements

The National Milk Producers Federation (NMPF) today applauded the inclusion of improvements to both the dairy Margin Protection Program (MPP) and the cotton program in the Senate Appropriations Committee mark-up of its fiscal year 2018 agricultural appropriations bill.

“We very much appreciate the leadership of Sens. Thad Cochran (R-MS) and Patrick Leahy (D-VT) to help address critical shortcomings in the dairy and cotton safety net programs through the agricultural appropriations bill,” said NMPF President and CEO Jim Mulhern. “The enhancements to the dairy Margin Protection Program contained in the bill would strengthen the program and help pave the way for additional necessary improvements in the upcoming farm bill,” Mulhern said.

The appropriations bill makes two important changes to the MPP that were included in NMPF’s farm bill proposal: It would reduce premiums paid by dairy farmers for the first 5 million pounds of milk coverage in the program, as well as change the U.S. Department of Agriculture’s calculation of the actual margin from a two-month average margin to monthly.

“By making the dairy safety net program more affordable,” Mulhern said, “this legislation will ensure that more farmers have access to better protection against catastrophic losses, likes those we experienced in 2009 and 2012. While there is more work to do to make the MPP the effective safety net that it was envisioned to be, these improvements are a great start.”

Mulhern lauded the work by Cochran and Leahy – the chairman and ranking member of the Appropriations Committee, respectively – as well Sens. Debbie Stabenow (D-MI) and Pat Roberts (R-KS), the leaders of the Senate Agriculture Committee, for their critical work on this issue. He said NMPF was pleased to work with the four principals to achieve these important improvements for dairy and cotton. “This bi-partisan collaboration is a clear affirmation of how to get important work done,” Mulhern said.

While these provisions do not resolve all the problems with the MPP, Mulhern said enacting these changes will be a major help. “NMPF will continue to work with Congress and the Administration through the farm bill process to address other problems so that the MPP can truly provide real safety net support. While the MPP remains a work in progress, this development is a major step in the right direction.”



June Milk Production up 1.7 Percent
                       
Milk production in the 23 major States during June totaled 16.9 billion pounds, up 1.7 percent from June 2016. May revised production at 17.8 billion pounds, was up 1.9 percent from May 2016. The May revision represented an increase of 17 million pounds or 0.1 percent from last month's preliminary production estimate.

Production per cow in the 23 major States averaged 1,939 pounds for June, 13 pounds above June 2016.  This is the highest production per cow for the month of June since the 23 State series began in 2003.

The number of milk cows on farms in the 23 major States was 8.73 million head, 83,000 head more than June 2016, and 4,000 head more than May 2017.

IOWA MILK PRODUCTION 
Milk production in Iowa during June 2017 totaled 426 million pounds, up 2 percent from the previous June according to the latest USDA, National Agricultural Statistics Service – Milk Production report. The average number of milk cows during June, at 217,000 head, was the same as last month and 4,000 more than last year. Monthly production per cow averaged 1,965 pounds, the same as last June.



April-June Milk Production up 1.8 Percent

Milk production in the United States during the April - June quarter totaled 55.3 billion pounds, up 1.8 percent from the April - June quarter last year.  The average number of milk cows in the United States during the quarter was 9.40 million head, 29,000 head more than the January - March quarter, and 76,000 head more than the same period last year.

NEBRASKA MILK PRODUCTION
Milk production in Nebraska during the April-June 2017 quarter totaled 360 million pounds, up 3 percent from the April-June quarter last year, according to the USDA's National Agricultural Statistics Service. The average number of milk cows was 60,000 head, unchanged from the same period last year.



NMPF Proposal to Improve H-2A for Dairy Advances Thanks to Rep. Newhouse

In a meeting today with Rep. Dan Newhouse (R-WA), National Milk Producers Federation President and CEO Jim Mulhern expressed appreciation on behalf of the nation’s dairy farmers for the congressman’s work to advance NMPF’s proposal to expand the H-2A farm worker visa program to include year-round employees on dairy farms.

During consideration Wednesday of the U.S. Department of Homeland Security’s annual funding bill, Rep. Newhouse offered an amendment that would allow farm employers to use the H-2A visa program to hire foreign workers, regardless of whether those employees are engaged in temporary or seasonal work. NMPF and leaders of its Immigration Task Force worked with Rep. Newhouse and Appropriations Committee leaders to advance the proposal so that dairy farmers can more readily use the H-2A visa program to fill their need for year-round workers. The amendment was adopted by the House Appropriations Committee with bipartisan support.

“Expanding the scope of the H-2A farm worker visa program is part of the continuing effort of NMPF and its members to find solutions to the labor challenges facing America’s dairy industry,” Mulhern said. “Dairy farmers have cows that need to be milked twice a day, every single day, yet they largely have not been able to utilize the H-2A visa program because of how the U.S. Department of Labor interprets the existing program, which restricts the visas only to the temporary and seasonal labor needs of agricultural employers,” he said.

NMPF Immigration Task Force Chairman Mike McCloskey, a Fair Oaks, Ind., dairy farmer, said the H-2A changes are an important first step to address the labor challenges facing U.S. dairy farmers. “We have been working with the administration to correct this, and now, thanks to Rep. Newhouse and many other legislators on both sides of the aisle, we have additional support to prompt the Department of Labor to expand the scope of the H-2A program beyond just seasonal jobs. This will make the H-2A program much more attractive and valuable to America’s dairy farmers.”

While the Newhouse measure has drawn criticism from some farm union organizations, NMPF believes creating an additional legal pathway for workers to connect with farm employers deserves bipartisan support. “This measure simply broadens an existing program for farm workers to recognize the unique needs of dairying,” Mulhern said. “It is critical to the vitality of the U.S. dairy industry and the fate of thousands of farm workers that our government creates and supervises a system that provides secure, legal employment. We hope the merits of this approach will surmount any opposition,” he said.

Mulhern said he was pleased that other dairy groups that have not been involved in this effort have since expressed appreciation for the NMPF-backed proposal. He said NMPF’s Immigration Task Force, which represents NMPF member co-ops and state dairy associations across the country, have been working on these issues for years, and is pleased to see progress in this effort. In addition to working with Rep. Newhouse and leaders of the House Appropriations and Judiciary committees, NMPF’s immigration efforts have involved extensive outreach to Trump Administration officials in a comprehensive effort to address the workforce needs of farm employers.

Beyond the efforts to improve the H-2A program, Mulhern said he is optimistic that NMPF’s work with the House Judiciary Committee will soon result in an agricultural visa program bill.

“This amendment is a great complement to our long relationship and work with House Judiciary Chairman Bob Goodlatte and other members of Congress to address the need for a legal, reliable supply of farm workers,” said Mulhern. “We still need broader legislation that addresses the limited labor supply available to America’s farm employers. It’s in the best interest of all parties to acknowledge the deficiencies of the current system, where many of our farm workers are not legally documented, and where many employers don’t have access to a viable guest worker program.”

He added that NMPF and its members “remain committed to a long-term solution to the crisis of farm labor shortages in rural America. We need to maintain our current workforce while creating a sensible, workable means of filling farm jobs in the future. We will continue to work with Congress and the administration toward that end.”



2017 USGC Trade Team Season In Full Swing

The 2017 U.S. Grains Council (USGC) trade team season is in full swing with more than two dozen teams from around the world scheduled to traverse U.S. farm states throughout the summer and fall.

“Trade teams provide truly unique opportunities to help familiarize our international customers with the U.S. grain export system,” said Kimberly Atkins, USGC vice president and chief operating officer. “These face-to-face interactions develop critical connections that open new markets and instill long-term trust in the United States supply chain from the farm to delivery.”

The Council’s trade teams focus on providing a complete look at the U.S. grain or ethanol value chains. As such, they have diverse itineraries that can include visits to seed technology providers, equipment manufacturers, ethanol plants, grain trading companies and transportation facilities in addition to interacting directly with U.S. corn, barley or sorghum farmers.

One such team of craft brewers from Mexico recently completed their trade team visits to Idaho, Montana and Wyoming. The brewers on the team told the Council the trip expanded not only their view of U.S. barley and malt, but also their vision for doing business with U.S. producers.

“We got to see much more about one of our basic ingredients than we ever knew before,” said Alejandro Cortés, the head brewer for Cervecería de Colima, who participated in team activities. “The trip was great in terms of focusing on different parts of barley, from breeding to agronomics and the malthouses as well.”

The ultimate goal of this knowledge gained and these relationships established is increased purchases of U.S. feed grains and co-products. But these outcomes can also build trust with government officials, policy-makers and members of the international press.

A Japanese media team focused on ethanol recently traveled to Washington, D.C., and Nebraska to demonstrate the positive impacts of corn-based ethanol. Like others, members of this trade team took what they learned home to provide better insights and information about U.S. feed grains and co-products.

“By seeing U.S. grain and export systems firsthand, the Council facilitates not only short-term sales, but also long-term, loyal customers,” Atkins said. “Showing the pride that U.S. farmers have in their crops as well as their commitment to provide a high-quality product goes a long way to growing the global grain market.”



NCGA Welcomes McKinney Nomination at USDA

The following is a statement from the National Corn Growers Association on Indiana Agriculture Director Ted McKinney’s nomination for Undersecretary for Trade and Foreign Agricultural Affairs at the U.S. Department of Agriculture, a new post created under the 2014 Farm Bill.

“Congratulations to Ted McKinney on being named Undersecretary for Trade and Foreign Agricultural Affairs. NCGA has long advocated for a dedicated position at USDA focused on increasing global demand for U.S. agriculture, and pushed for this in the last farm bill. We thank the Trump Administration for listening, and continuing to move that process forward. Trade is more important than ever for farmers to overcome this challenging farm economy.

“Mr. McKinney is an excellent choice to fill this new role. He has a longstanding record of service to the agriculture industry, and will be a strong advocate for U.S. agriculture on the global stage. We urge the Senate to move quickly to confirm him, so that our industry is in the best position to capitalize on increased global demand for our products.”

“We also thank the Administration for heeding our call for a full leadership team at USDA, making several appointments in the last week. We urge that process to continue. There is much work to be done, and we are eager to work together to build a stronger farm economy and move agriculture forward.”



ASA Supports McKinney, Clovis Nominations at USDA

The American Soybean Association (ASA), which represents growers of the nation’s largest agricultural export, expressed its support today for Ted McKinney to fill the newly established Under Secretary for Trade and Foreign Agricultural Affairs post at USDA, and Sam Clovis as Under Secretary for Research, Education and Economics.

“The U.S. exports well over half of the soybeans we produce, and agriculture is one of only a handful of business sectors in the country with a positive trade balance--$17 billion last year. That success abroad leads to success here at home, returning billions to the economy and supporting more than a million jobs. Ted McKinney is a person that understands the global nature of our business, and has represented farmers well in both the public and private sectors,” said ASA President Ron Moore, a soybean farmer from Roseville, Ill. “In his role as director of the Indiana State Department of Agriculture, and is his previous leadership roles within the agriculture industry, Ted has exemplified the understanding of how as American farmers our work impacts and is impacted by the world around us. ASA supports Ted’s nomination and looks to the Senate to quickly confirm him.”

McKinney’s prospective position in the newly-created Undersecretary for Trade post at USDA is one that ASA and other agriculture groups have long advocated for, including in a letter to the White House in late February.

Moore also added ASA’s support for Clovis, saying that “Dr. Clovis’ Iowa and rural Kansas roots will serve him well as the department moves to serve farmers in the fields of research and economics. Dr. Clovis understands the importance of agricultural research to farmers, our ongoing success, and the success of future generations of farmers. He also is well acquainted with the economic issues facing farmers and ranchers. We will look to Dr. Clovis to help advance USDA’s mission in these important fields.”



U.S. Wheat Organizations Applaud McKinney Nomination for USDA Post

On July 19, 2017, the Trump Administration announced a declaration of intent to nominate Ted McKinney for Under Secretary for Trade and Foreign Agricultural Affairs at the U.S. Department of Agriculture (USDA). In May, the USDA created the new Under Secretary for Trade and Foreign Agricultural Affairs position, as directed by the 2014 Farm Bill.

“McKinney’s leadership experience as Indiana’s Agriculture Director and longstanding background in trade make him an ideal candidate for this position,” said David Schemm, president of the National Association of Wheat Growers (NAWG) and a wheat farmer from Sharon Springs, Kansas. “The U.S. wheat industry applauds the Administration’s choice and calls for a quick confirmation hearing in the Senate.”

Indiana Agriculture Director Ted McKinney spent over 30 years in various roles with Dow AgroSciences and Elanco, a subsidiary of Eli Lilly and Company.

“McKinney has been a champion for U.S. agriculture throughout his career and clearly understands the importance of access to foreign markets,” said Mike Miller, chairman of U.S. Wheat Associates (USW) and a wheat farmer from Ritzville, Wash. “We look forward to working with him and his team at USDA to expand trade opportunities for U.S. farmers.”