Thursday January 18 Ag News

Rural Mainstreet Economy Slumps into Negative Territory for Fifth Straight Month

For a fifth straight month, the overall Rural Mainstreet Index (RMI) sank below growth neutral, according to the January survey of bank CEOs in rural areas of a 10-state region dependent on agriculture and/or energy.

Overall: The region’s overall reading for January rose to 48.1 from 41.7 in December. The index ranges between 0 and 100, with a reading of 50.0 representing growth neutral.

“Higher interest rates, weaker agriculture commodity prices and a credit squeeze are having a significant and negative impact on Rural Mainstreet businesses and on Rural Mainstreet farmers. Jim Eckert, CEO of Anchor State Bank in Anchor, Ill. indicated that unless crop prices improve, 2024 will not be a good year for area farmers,” said Ernie Goss, PhD, Jack A. MacAllister Chair in Regional Economics at Creighton University’s Heider College of Business.

Farming and ranching land prices: The region’s farmland price index fell to a still strong 64.0 from December’s 67.2. The farmland price index has remained above growth neutral for every month since November 2019. “Creighton’s survey continues to point to solid, but slowing, growth in farmland prices. Approximately, 28.0% of bankers reported that farmland prices expanded from December levels,” said Goss.

Farm equipment sales: The farm equipment-sales index for January sank to 47.9 from December’s weak 49.5. “This is the seventh time in the past eight months that the index has fallen below growth neutral. Higher borrowing costs, tighter credit conditions and weaker grain prices are having a negative impact on the purchases of farm equipment,” said Goss.

“For a fourth consecutive month, several bankers voiced concerns over economic losses by pork producers in their area,” said Goss.

When asked about the share of farm clients facing generational transition, on average, bankers estimate that approximately 25% will face transition issues in the next decade. Furthermore, 19.2% expected transitioning farm clients to pose an economic opportunity for their banking operations with 65.4% expecting both opportunities and threats from this transitioning.

Of those transitioning, bank CEOs expected 53.8% to transfer ownership to heirs, and 42.3% anticipate the sale to other farmers in the area. Bankers expect virtually no sales to farmers outside the area, including foreign buyers.

Below are the state reports:
Nebraska: The Nebraska RMI for January increased to 39.5 from 37.3 in December. The state’s farmland price index for January declined to 60.0 from 63.7 in December. Nebraska’s January new-hiring index slumped to 45.5 from December’s 46.5. U.S. Bureau of Labor Statistics (BLS) data indicate that over the past 12 months, the state’s Rural Mainstreet economy expanded employment by 0.3%, while the state’s urban areas grew employment by a much higher 1.3%.  

Iowa: January’s RMI for the state decreased to 44.3 from 45.5 in December. Iowa’s farmland price index for January declined to 61.4 from December’s 64.0. Iowa’s new hiring index for January increased to 45.1 from 46.9 in December. U.S. Bureau of Labor Statistics (BLS) data indicate that over the past 12 months, the state’s Rural Mainstreet economy expanded employment by 1.1%, while the state’s urban areas grew employment by a much lower 0.3%.

The survey represents an early snapshot of the economy of rural agriculturally- and energy-dependent portions of the nation. The Rural Mainstreet Index is a unique index covering 10 regional states, focusing on approximately 200 rural communities with an average population of 1,300. The index provides 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 and launched it in January 2006.



Farm Service Agency Reminds Producers of ARC/PLC Commodity Crop Safety Net Enrollment for 2024 Production Season
UNL, Nebraska FSA to Host ARC/PLC Informational Webinar and Local Meetings

Nebraska USDA Farm Service Agency (FSA) is reminding producers now is the time to make elections and enroll in the Agriculture Risk Coverage (ARC) and Price Loss Coverage (PLC) programs for the 2024 crop year. The signup period is open through March 15, 2024, and producers are encouraged to begin working with their USDA county Farm Service Agency (FSA) office to complete the process.

Producers can learn about the ARC and PLC options for 2024 during a University of Nebraska-Lincoln Center for Agricultural Profitability (CAP) webinar scheduled for 12:00 p.m. CT on Thursday, Jan. 25. Dillon Breinig, production and compliance programs specialist for the Nebraska Farm Service Agency, and Brad Lubben, Extension policy specialist in the University of Nebraska-Lincoln’s Department of Agricultural Economics, will present and share information relevant for producers, ag professionals and ag stakeholders. Registration for the webinar is free and can be found directly at https://go.unl.edu/wpa0 or go to the CAP website at cap.unl.edu/webinars.

In addition to the webinar, UNL Extension and FSA staff will be hosting in-person ARC/PLC information meetings at locations across Nebraska, including:
North/Northwest: Alliance, Feb. 8; Gering, Feb. 6; Sidney, Feb. 7; and Valentine, Feb. 9
Southwest/West Central: Imperial, Date TBD; McCook, Date TBD; North Platte, Feb. 21; and Holdrege, Feb. 22
Northeast: O’Neill, Feb. 15; Norfolk, Feb. 20; Wayne, Feb. 8; Columbus, Feb. 7; and West Point, Feb. 13
Central/East Central/Southeast: Auburn, Feb. 7; Beatrice, Date TBD; Hastings, Feb. 14; Mead, Feb. 9; Ord, Feb. 20; and York, Feb. 6.

The meetings are free and open to the public. To find the current listing with meeting location details, dates and times, go to https://cap.unl.edu/farmbill. This list will be updated with more information as it becomes available.

ARC and PLC are key USDA safety-net programs that help producers weather fluctuations in either revenue or price for certain crops.

“Safety-net programs like ARC and PLC are designed to help producers mitigate some of the financial stressors associated with crop production. I encourage farmers to evaluate their program elections and enroll for the 2024 crop year,” said Nebraska FSA Acting State Executive Director Tim Divis.

Brad Lubben, Extension policy specialist and director of CAP, said changes in commodity crop prices over the past several years may influence producers’ ARC/PLC decision-making process for 2024.

“With the one-year extension of the 2018 Farm Bill, producers face a familiar choice between ARC and PLC for 2024, but under different circumstances now as compared to the past several years,” said Lubben. “Understanding the program mechanics and analysis will help producers make sound enrollment decisions with FSA.”

ARC provides income support payments on historical base acres when actual crop revenue declines below a specified guaranteed level. PLC provides income support payments on historical base acres when the effective price for a covered commodity falls below its effective reference price. Producers can elect coverage and enroll in ARC-County or PLC on a crop-by-crop basis, or ARC-Individual for the entire farm, for the 2024 crop year. Although election changes for 2024 are optional, enrollment (signed contract) is required for each year of the program. If a producer has a multi-year contract on the farm, it will be necessary to sign a new contract for the farm by the March 15th deadline if a 2024 election change is desired.

If an election is not submitted by the deadline of March 15, 2024, the election defaults to the current election for crops on the farm from the prior crop year.

All program participants are encouraged to review their previous program elections, Divis said.



Statement by Mark McHargue, President, Regarding Governor’s State of the State Address

“We thank Governor Pillen for again recognizing high property taxes as the greatest challenge facing Nebraska and reiterating his commitment to fixing our state’s property tax problem. We greatly appreciate the urgency with which he is working to address the issue and applaud him for his understanding and openness in communicating the far-reaching negative impacts high property taxes have had and continue to have on all Nebraskans. Furthermore, we agree with the Governor that a hard cap on property tax collections is critical to achieve long-term property tax relief, and simultaneously appreciate his commitment to preserving local control.  We look forward to working with the Governor and the Legislature to address this critical issue.”



NDEE announces in-person meetings for the Climate Pollution Reduction Grants planning efforts

The Nebraska Department of Environment and Energy (NDEE) is continuing public outreach for Nebraska’s Climate Pollution Reduction Grants (CPRG) planning efforts. The agency is holding a series of in-person public meetings to provide a progress update and accept public comments.

The CPRG is a $3 million grant from the U.S. Environmental Protection Agency through the Inflation Reduction Act. The grant provides funding for states and local governments to develop and implement a Priority Climate Action Plan and a Comprehensive Climate Action Plan to reduce greenhouse gas (GHG) emissions.

The public meetings, scheduled in January and early February, will include a short presentation about the CPRG program and process, the GHG emission reduction measures discussed in previous virtual stakeholder sessions held in late 2023, and the priority measures identified. Attendees will have the opportunity to discuss the measures, ask questions, and provide input and comment on NDEE’s proposed priority rankings.

Five scheduled meetings are planned across Nebraska:

Alliance: Knight Museum
908 Yellowstone Avenue
Tuesday, Jan. 30, from 5:30-7 p.m.

North Platte: Mid-Plains Community College (North Campus)
Rooms 105 and 107
1101 Halligan Drive
Wednesday, Jan. 31, from 5:30 to 7 p.m.

Norfolk: Northeast Community College
Lifelong Learning Center, Rooms E and H
801 East Benjamin Avenue
Tuesday, Feb 6, from 5:30 to 7 p.m.

Lincoln: Park Middle School
855 South 8th Street, Door 5
Thursday, Feb 8, from 6 to 8 p.m.

Grand Island: Public Library
Meeting Room B
1124 West 2nd Street
Monday, Feb. 12, from 5:30 to 7 p.m.

In November and December, NDEE held a series of virtual meetings with stakeholder workgroups to discuss potential greenhouse gas reduction measures in different economic sectors, including agriculture, energy production, transportation, industry, waste and wastewater, and commercial and residential buildings.

These sessions assisted NDEE in developing a tentative set of priority measures to include in the Priority Climate Action Plan that must be submitted by March 1 of this year. This plan is intended to include high impact, readily implemented greenhouse gas reduction measures. Lower-impact measures may still be considered for inclusion in the Comprehensive Climate Action Plan that is due by August 2025.

If you have an idea for a greenhouse gas reduction measure you would like NDEE to consider for inclusion in Nebraska’s climate action plans and cannot attend a meeting, you can submit your idea using this web link: https://go.unl.edu/ndee-feedback. Please describe the measure and provide as much information as possible to ensure full consideration. The web form also allows you to upload supporting documents.

If you would like to review and comment on NDEE’s current prioritization ranking and process, please use this web link: https://go.unl.edu/cprg-priority-ranking.

For further information about the program or to review meeting notes from the previous workgroup sessions, please visit NDEE’s website: dee.ne.gov/ndeqprog.nsf/onweb/cprg

If you have other questions about the Climate Pollution Reduction Plan, please contact the NDEE using this web link: NDEE.climatepollution@nebraska.gov



Deadline Approaching for Crop Insurance Discount Program

Iowa Secretary of Agriculture Mike Naig today reminded farmers and landowners who planted cover crops this past fall to apply for the state’s Crop Insurance Discount Program ahead of the Friday, January 26 deadline.

Eligible Iowans can receive a $5 per acre discount on spring crop insurance premiums.  To sign-up, visit Apply.CleanWaterIowa.org.

“Iowa farmers and landowners continue to utilize conservation and water quality practices, including cover crops, at record levels,” said Secretary Naig. “The Crop Insurance Discount Program helps defray some of the costs of getting these cover crops established, so I encourage farmers to get their eligible acres enrolled before the deadline.”

Now in its seventh year, this innovative program, offered by the Iowa Department of Agriculture and Land Stewardship, has become a model for other states and the federal government. To date, nearly 2,000 Iowa farmers have enrolled over 1,000,000 acres of cover crops in the program. To qualify for the program, the cover crop acres cannot be enrolled in other state or United States Department of Agriculture (USDA) Natural Resources Conservation Service (NRCS) cost share programs.

Program Details
The Crop Insurance Discount Program is jointly administered by the Iowa Department of Agriculture and Land Stewardship and United States Department of Agriculture (USDA) Risk Management Agency (RMA). Iowa’s program has served as a model and has been replicated by the USDA as well as Wisconsin, Illinois and Indiana. To qualify for the Crop Insurance Discount Program, the cover crop acres cannot be enrolled in other state or federal cost share programs. Farmers should visit the local USDA Service Center to learn about other cost share funding available to support the implementation of conservation practices. Some insurance policies, such as Whole-Farm Revenue Protection or those covered through written agreements, may be excluded. Participants must follow all existing farming practices required by their respective policy and work with their insurance agencies to maintain eligibility.



Weekly Ethanol Production for 1/12/2024

According to EIA data analyzed by the Renewable Fuels Association for the week ending January 12, ethanol production pulled back 0.8% to 1.054 million b/d, equivalent to 44.27 million gallons daily. Yet, output was 4.6% more than the same week last year and 3.6% above the five-year average for the week. The four-week average ethanol production rate decreased 0.4% to 1.068 million b/d, which is equivalent to an annualized rate of 16.37 billion gallons (bg).

Ethanol stocks swelled 5.4% to a 43-week high of 25.7 million barrels. Stocks were 9.8% more than the same week last year and 8.7% above the five-year average. Inventories built across all regions.

The volume of gasoline supplied to the U.S. market, a measure of implied demand, ebbed 0.7% to 8.27 million b/d (126.76 bg annualized). Demand was 2.7% more than a year ago but 1.4% below the five-year average.

Refiner/blender net inputs of ethanol improved 3.9% to 835,000 b/d, equivalent to 12.80 bg annualized. Net inputs were 0.1% more than a year ago and 0.2% above the five-year average.

Ethanol exports were estimated at 95,000 b/d (4.0 million gallons/day), or 39.5% below the prior week. There were zero imports of ethanol recorded for the 17th consecutive week.



Latest Developments in Moroccan Phosphate Duties
ASA Newsletter

In recent developments concerning the Court of International Trade's remand of duties on Moroccan phosphate imports, the Department of Commerce has issued a new duty rate of 7.41%, a significant decrease from the previous 19.97%. This follows ASA's participation in an amicus brief opposing the initially imposed duties by the International Trade Commission and Commerce.

Despite this positive step, it falls short of the administrative review rate of 2.12% issued in November 2023. ITC also upheld its original determination that the domestic industry suffered harm from Moroccan imports.

Next Steps
The next step involves the CIT reviewing each agency's remand determination and making a final ruling. The CIT considers submissions from other parties to the litigation during this process. The potential appeals to the Federal Circuit in both the Commerce and ITC cases add a layer of complexity to the ongoing situation.



National Corn Growers Association Expresses Disappointment with International Trade Commission Decision on Fertilizer Tariffs

The National Corn Growers Association (NCGA) said today that it is deeply disappointed in a decision released by the International Trade Commission, which upholds an earlier opinion that found material injury to U.S. fertilizer companies during a time of rising on-farm fertilizer prices that went on to reach record highs.

The decision comes after the U.S. Court of International Trade asked the U.S. Department of Commerce and ITC to reconsider earlier decisions they issued on the matter.

“The idea that major fertilizer conglomerates were materially injured even as they were posting substantially higher profits during the time in question sounds dubious to me,” said Minnesota farmer and NCGA President Harold Wolle. “ITC’s decision flies in the face of the U.S. Court of International Trade’s request to seriously reconsider this issue and ignores the negative impact these tariffs continue to have on America’s farmers who are facing higher prices for fertilizers that are critical to the success of their crops. We will continue to make a vigorous case for eliminating or lowering these tariffs.”

The ITC opinion upholds an earlier decision by the agency that the trade practices of a Moroccan-based company caused harm to U.S. fertilizer companies. The decision comes almost a week after the U.S. Department of Commerce announced it was lowering duties on these products from 19.97% to 7.41%, and introduces uncertainty on the fate of tariffs as it could be used as an argument to keep tariffs on phosphate fertilizers high.

The U.S. Court of International Trade will now review the remand decisions and issue a final ruling. The Department of Commerce is also set to make another decision regarding its administrative review later this year.

Commerce and the ITC originally acted on a petition by The Mosaic Company, a U.S.-based fertilizer producer, which had requested the tariffs over what it called unfair trading practices. Over the past three years, NCGA has advocated for growers who were facing record-high phosphate prices by filing an amicus brief in the case, sending letters to the White House and federal agencies, and informing Members of Congress about the impact of the high prices on corn farmers.



NCBA Continues to Push for Death Tax Relief

The National Cattlemen’s Beef Association (NCBA) strongly supports the Death Tax Repeal Act, led by Reps. Randy Feenstra (IA) and Sanford Bishop (GA). The Senate companion bill is led by Sen. John Thune (SD). Repealing the federal estate tax, also known as the Death Tax, is a top priority for NCBA.

“It is unconscionable for cattle producers to face a tax that forces them to sell all or part of their family’s farm or ranch due to the death of a family member. With the cost of farmland rapidly rising, the Death Tax presents a significant threat to the future of family farms and ranches,” said NCBA President and South Dakota cattle producer Todd Wilkinson. “Most cattle producers have significant assets but are cash-poor and operate on thin margins, leaving them with few options when they are saddled with an unexpected tax liability. Some producers are forced to sell off assets including land, livestock, farm equipment, or even their home. This is an incredible loss, and it starts a vicious cycle where future generations continue to face punitive taxes their ancestors paid multiple times. Rural America needs a tax code that promotes multi-generational, family-owned businesses instead of chopping them up.”

Current Death Tax relief is set to expire at the end of 2025, and it is vital that Congress acts soon and provide permanent relief for our family operations. If the federal estate tax exemption reverts to pre-2017 limits, coupled with the rapid inflation of farmland values, many more families will be subject to the Death Tax.



Statement from Agriculture Secretary Tom Vilsack on Meeting with China’s Minister of Agriculture and Rural Affairs Tang Renjian

Agriculture Secretary Vilsack offered the following statement following his meeting today with People’s Republic of China Minister of Agriculture and Rural Affairs Tang Renjian:

“Today I hosted a meeting with my counterpart from the People’s Republic of China, Minister of Agriculture and Rural Affairs Tang Renjian. In addition to addressing outstanding market access issues and other U.S. agricultural stakeholder concerns, we discussed approaches to tackling climate and food security challenges. I emphasized the importance of an enabling environment for innovative technologies and practices to ensure productive and sustainable agriculture systems and to facilitate trade.

“I look forward to further exchanges and cooperation as we continue to forge a relationship that expands and improves market access opportunities for U.S. farmers and ranchers in China, an important agricultural export market.”

Today marked the first meeting since 2015 of the Joint Committee on Cooperation in Agriculture, which was established in 2003 as a forum for coordinating bilateral exchanges and cooperation in agriculture between the United States and China.



Case IH Farmall 75C Electric and Steiger 715 Quadtrac Receive 2023 Good Design Awards  

Case IH, a global leader in agriculture equipment, is recognized as a 2023 Good Design® Award Winner for the Farmall 75C Electric and the Steiger 715 Quadtrac tractors. The award, presented by the Chicago Athenaeum, showcases global industrial innovation and cutting-edge graphical designs.

“Case IH is tireless in its commitment to innovation. Ultimately, it is that purposeful innovation that increases efficiency and productivity for agriculture producers around the globe,” said Kurt Coffey, Vice President Case IH North America. “We are proud to be recognized, once again, with Good Design Awards for the sustainable and powerful developments across our tractor portfolio.”   

Both the Farmall 75C Electric and Steiger 715 Quadtrac already boast award-winning pedigree with Farm Machine 2024 and ASABE AE50 Awards respectively.   

Farmall 75C Electric
Revealed publicly at Farm Progress Show 2023, the Farmall 75C Electric is Case IH’s first fully electric tractor. Sporting a brand-new design with diesel-like performance and power, the tractor is designed for agriculture’s toughest jobs.   

The electrification of the Farmall coupled with the reduction in wear and tear on parts and maintenance costs, can provide users with a reduction in operating expenses when compared to diesel tractors. Offboard digital features and additional automation capabilities like Safety Mode let farmers operate the vehicle with far more efficiency.   

Steiger 715 Quadtrac
Launched in 2023, the Steiger 715 Quadtrac was created to fulfill the customer need of increased productivity. Case IH focused on addressing the customer pain point of how to increase productivity by pulling larger implements at faster speeds while simultaneously enhancing the operator experience.  

The most powerful Steiger tractor purposefully addresses this challenge with 715 engine horsepower, redesigned exhaust to improve cab visibility, enhanced LED lighting to extend daily operations into the night, faster road speed to reduce travel time and a new hood that provides both improved service access and a signature new look that designates new levels of technology and performance that Case IH strives to provides its customers.  

“From Farm Machine 2024, to ASABE and now Good Design, Case IH is being recognized for the innovations we’re making to serve farmers,” added Harris. “Awards are nice, but we never stop at ‘good enough’. Evolution is in our blood at Case IH and we are honored to receive recognition from prestigious organizations like Good Design.”