Wednesday October 17 Ag News

NDA DIRECTOR ANNOUNCES AMELIA BREINIG AS NEW ASSISTANT DIRECTOR

Nebraska Department of Agriculture (NDA) Director Steve Wellman today announced the appointment of Amelia Breinig to the position of assistant director. Breinig, who has education and experience in communications and international trade, began her NDA duties this week.

“Amelia understands agriculture and the importance of trade in Nebraska’s economy,” said Wellman. “Her experience in international trade combined with her solid communications background will help Nebraska farmers, ranchers and agribusiness leaders share the story of our quality agricultural products with the world.”

Breinig is a native Nebraskan, growing up on her family farm near Arapahoe. She earned her bachelor's degree from the University of Nebraska-Lincoln in Journalism and a Master of Business Administration from the University of Minnesota.

Most recently, Breinig worked at the Office of the United States Trade Representative (USTR). USTR is responsible for developing and recommending U.S. trade policy to the President, conducting trade negotiations at bilateral and multilateral levels, and coordinating trade policy within the U.S. government. Prior to that, Breinig worked in Washington, D.C. for Senator Deb Fischer, Congressman Lee Terry and the Senate Finance Committee communications team.

“I am thrilled to be a part of the Nebraska Department of Agriculture in a state where agriculture leads the nation in so many ways,” said Breinig. “Having grown up on my family’s farm, I look forward to having a positive effect on the agriculture industry and learning more about Nebraska policies and regulations.”



2018 Nebraska Farm Custom Rates Statewide Survey Summary
Glennis McClure, Associate Extension Educator

Many Nebraska agricultural producers hire custom operators to perform machinery services for their farms and ranches across the state. The 2018 Nebraska Custom Rates Survey Report summarizes the current rates charged for specific machinery operations and other on farm or ranch custom services. Prices paid for these services become more critical as profit margins tighten because of lower commodity prices.

Findings from the survey are divided into two major sections. Part I includes spring and summer operations such as tillage, planting and harvesting of small grains. Part II includes information about fall and miscellaneous operations. Custom rate summaries in these sections include regional rates for the eight Nebraska Agricultural Statistics Districts and the overall state. A total of 151 custom rates on machinery operations and related services were reported as part of the 2018 survey with 227 survey participants providing information on the various rates. Custom rates reported include charges for the use of necessary equipment, fuel, labor and supplies, such as baling wire or twine, provided by the custom operator. Seed, fertilizer and chemical costs are not included.

Full summaries from this survey, including district as well as state data, are published as a University of Nebraska-Lincoln Extension Circular (EC) 823 and available online at agecon.unl.edu/custom-rates.



Corteva Agriscience and AGP Announce 2019 Program for Pioneer® brand Plenish® High Oleic Soybeans

Ag Processing Inc. (AGP) will offer production contracts for Pioneer® brand Plenish® high oleic soybeans for 2019 production.  Production areas will be near Hastings, Nebraska. This is the third year AGP is contracting soybeans to be processed near its Hastings plant or with a participating elevator.

Farmers who contract with AGP to grow Pioneer® brand Plenish® high oleic soybeans in 2019 can earn a processor-paid premium of $0.30/bu for a harvest delivery to a designated elevator or $0.35/bu for buyer’s call. Additional program details are available from local AGP soybean merchandisers, local Pioneer sales professionals and at www.pioneer.com/plenish.

Pioneer® brand Plenish® high oleic soybean varieties are developed with elite genetics using Pioneer’s Accelerated Yield Technology (AYT) 4.0. Multiple years of local testing has confirmed yields are on par with similar elite commercial soybean varieties. With 0g transfat per serving and 20 percent less saturated fat than commodity soybean oil, Plenish high oleic soybean oil provides a sustainable, U.S.-grown, soy-based transfat alternative for food companies and foodservice operators.



Mexican Buying Team Visits Local White Corn Operations To Learn How To Buy

White corn grain buyers from Mexico are in the United States to see U.S. grain production and the U.S. export system for themselves – from harvest to shipping – in Illinois, Nebraska, Missouri, Kentucky and Minnesota.

The team came stateside to tour farms, elevators and other pieces of export infrastructure in both Nebraska and Kentucky and meet with the people who produce and sell their grains.

After their state visits, the team will attend Export Exchange, a conference for grain buyers held every other year sponsored by the U.S. Grains Council (USGC), Growth Energy and the Renewable Fuels Association (RFA). The conference will let these Mexican buyers meet with U.S. sellers of corn, sorghum, barley, distiller’s dried grains with solubles (DDGS), corn gluten meal and corn gluten feed.The Nebraska Corn Board and Kentucky Corn Growers each provided funding to bring the Mexican team to Export Exchange and to the post-tour held in each of the states.

“Trade is vitally important to the American farmer,” said David Bruntz, chairman of the Nebraska Corn Board and farmer from Friend, Nebraska. “We appreciate all of our customers and want to ensure them we’re a reliable supplier of quality ag products. By inviting Mexican grain buyers to the U.S., we can answer any questions they may have and demonstrate the amount of care that goes into U.S. grain production.”

The Mexican team includes senior procurement staff members from a major Mexican corn flour and tortilla manufacturing company. It will be in the states to learn about the U.S. white corn production chain and to better understand quality standards for U.S. white corn exports.

In addition, the team members hope to establish new relationships with U.S. white corn and specialty organic corn suppliers. Their visit will include a trip to the Federal Grains Inspection Service’s (FGIS’s) National Grain Center in Kansas City, meetings with farmers in Nebraska and Kentucky and stops at elevators and river and rail terminals.

“At a time when we have just agreed to a new U.S.-Mexico-Canada Agreement, highlighting the importance of international trade can be no better illustrated than by Export Exchange and the trade team visits before and after the event,” said Tom Sleight, president and CEO of the U.S. Grains Council.

“It is essential for us to strengthen the bonds between suppliers and partner countries, and the connections made at this critical event will not only help propel our industry this year, but for years to come.”

A total of 21 pre- and post-Export Exchange trade teams sponsored by the Grains Council and grain checkoffs will visit this month, offering the 200 participating grain buyers a chance to see the U.S. supply and quality for themselves.

Over the course of their activities in USGC member states, these individuals have opportunities to directly do business and make connections to facilitate future sales.

In addition to networking opportunities, foreign attendees traveling to the Export Exchange conference in Minneapolis will be briefed on the global supply and demand situation, transportation issues and challenges, the global grains outlook, new advances in DDGS and poultry, food safety regulations, and agribusiness, the current U.S. policy environment, and more.

Export Exchange also highlights the importance of strong trade policy and market development to U.S. agriculture. The Council, in partnership with Nebraska Corn and Kentucky Corn works in more than 50 countries and the European Union to market U.S. grains and their related products and build long-term demand from loyal customers.

This work is also supported by funding from USDA through the Market Access Program (MAP) and Foreign Market Development (FMD) program in the U.S. farm bill.

More information on Export Exchange 2018 is available at www.exportexchange.org. More from the Grains Council is at www.grains.org. More from the Nebraska Corn Board can be found at www.nebraskacorn.gov.



Nebraska Banker, Perdue Professor Receive Top Ag Banking Awards

The American Bankers Association today announced the recipients of both the Bruning and Blanchfield Awards, the association’s premier awards presented for contributions to agricultural banking. ABA will honor Fred Bruning, CEO of Bruning State Bank, Bruning, Neb., with the Bruning Award, and Purdue University ag economics Professor Emeritus Freddie Barnard with the Blanchfield Award at the ABA National Agricultural Bankers Conference, Nov. 11-14 in Omaha, Neb.

Bruning Award: Fred Bruning
Named after Nebraska banker Frank Bruning—Fred Bruning’s father and the first recipient 21 years ago—the Bruning Award recognizes the lifetime achievement of individuals for their leadership and outstanding dedication to providing credit and financial guidance to farmers, ranchers and businesses in rural America. Bruning, Fred.jpg

“When Frank, my dad, received this award years ago, it was very special for him, our family and the bank, especially because it was named after him,” said Bruning. “I am humbled that I get to follow in his footsteps and honored to be part of the group of bankers who have received the Bruning Award.”

Bruning is a fourth-generation banker serving at his family-owned, ag-focused bank for the past 27 years, but his contributions to agricultural banking reach far beyond serving the communities around Bruning, Neb. One of his most notable accomplishments, the creation of the ag banking and finance major at the University of Nebraska Lincoln, has resulted in more young people getting into ag banking. In addition to the major, Bruning worked with his staff, the university and the Nebraska Bankers Association to create a scholarship fund and internship program.

“Sixty-five percent of the kids who have gone through that program have returned to work at a rural bank in Nebraska,” said Bruning. “There is an enormous opportunity for young people to get into banking right now, and we’re finding ways to make that happen.”

Bruning’s career is filled with noteworthy accomplishments at both the local and national level. He was a founding member of the Farmers & Ranchers College, an annual education program supported by the University of Nebraska Lincoln Cooperative Extension. He has been a Nebraska LEAD fellow, a member of the USDA Task Force on Ag Policy and Rural Development, and a board member of the Nebraska Community Foundation. Currently, he is president of the Bruning Community Foundation, which fostered the development of a new library, fitness center, fire hall and several main street businesses.

Bruning earned a bachelor’s degree in ag economics and animal science from the University of Nebraska Lincoln. Before becoming a banker, he worked on the family farm near Bruning, Neb. He and his wife, Penni, have three children and two grandchildren.

Blanchfield Award: Dr. Freddie Barnard
Now in its fourth year, the ABA Blanchfield Award recognizes the contributions of a non-banker who has made significant contributions to the advancement of agricultural lending. Dr. Freddie Barnard, this year’s recipient, is professor emeritus of agricultural economics at Purdue University. barnardfc (2).jpg

“I am both honored and humbled to receive the Blanchfield Award because it represents qualities I hold dear; such as, dedication, commitment and member interaction,” said Barnard. “In addition, it is presented by an organization I have thoroughly enjoyed working with over the years and on behalf of people I call my friends. It is humbling to be included in a list of winners—John Blanchfield, Dave Kohl and Barry Flinchbaugh—who I consider the best of the best in our industry.”

Barnard joined the Purdue faculty in 1982 at the beginning of the farm crisis. That experience shaped his extension, teaching and research programs for the remainder of his career.

He taught agribusiness management to more than 4,000 students from Fall of 1995 until Spring of 2018, and was the lead author of the textbook Agribusiness Management, adopted by 34 educational institutions.

During his career, Barnard has spoken at more than 900 conferences, workshops and schools, attended by more than 46,000 agricultural lenders, producers and business managers. He served as director for the Midwest Agricultural Banking School for 36 years and coordinated the annual Indiana Bankers Agricultural Clinic and Advanced Agricultural Credit Workshop. He was one of the original members of the Farm Financial Standards Council, founded in 1989 to provide financial and managerial accounting recommendations for agricultural businesses. He also served as secretary/treasurer for the Indiana Chapter of the American Society of Farm Managers and Rural Appraisers from 1999 until 2018.

He has received numerous honors and awards including the Hovde Award for outstanding service to the people of the state of Indiana, induction into Purdue’s Book of Great Teachers and the Gold Quill award three times for outstanding articles published in the American Society of Farm Managers and Rural Appraisers Journal.

He retired from the Army National Guard and Reserves in 1998 at the rank of Lieutenant Colonel after 23 years of service. Barnard holds a B.S. and an M.S. in agricultural economics from the University of Kentucky and a Ph.D. in agricultural finance from the University of Illinois. 

He and his wife, Shirley, have three children, Jared, Mathew and Veronica.



Iowa Cattle Industry Leadership Summit

The Iowa Cattle Industry Leadership Summit will be Dec. 6-7, 2018 at the Prairie Meadows Events Center in Altoona. All cattle producers are invited to come for education, inspiration and the opportunity to talk to other members of the industry from around the state.

This year’s meeting will feature a large trade show, where seedstock, cow/calf and feedlot producers will be able to see new products, pick up educational materials, and find solutions to their everyday problems on the farm. The tradeshow will be open from 10 am to 5:30 pm on Thursday, December 6, and 8:30 am - noon on Friday, December 7.

Bruce Vincent, a Montana logger who was regulated out of business, will keynote the event. Vincent will share how environmentalists forced his family’s business to shut its doors after three generations, and advice to keep cattle producers from suffering the same fate.

The Iowa Cattlemen’s Association will also hold its policy committee meetings which are open to all members. The meetings are the final opportunity for cattlemen to discuss priorities for the association and set policy for 2019.

A social and banquet will cap off the first night, with the annual Iowa Cattlemen’s Foundation fundraiser auction and awards ceremony.

The next morning, an appreciation breakfast will be held for county leaders prior to the Iowa Cattlemen’s Association and Iowa Beef Industry Council annual meetings.

Anyone interested in attending can find more information at www.iacattlemen.org. Early registration ends November 12.



Continuing Momentum of Free Trade Agreements Welcome News for Soybean Growers

Trade negotiations are officially on the horizon with the European Union, Japan and the United Kingdom, continuing the momentum generated by a bilateral deal with South Korea (KORUS) and a renegotiated NAFTA agreement with Mexico and Canada, now the USMCA.

The American Soybean Association (ASA) has consistently requested a negotiated solution to the trade war with China and urged that exports lost to this key market be offset through new free trade agreements. ASA is hopeful that the Administration’s formal notice to Congress that it will enter trade negotiations with the European Union, Japan and the United Kingdom as soon as mid-January will make a settlement with China a plausible next step, bringing an end to the devastating tariff imposed on American soybeans.

Concluding the USMCA and success with subsequent FTA negotiations with Japan, the EU and other countries would mean opportunities to potentially increase U.S. soy and livestock product exports to other promising markets, including the Philippines. ASA is encouraging the Administration to consider adding Vietnam and Indonesia to its list of potential negotiating targets. Knowing, however, that increased sales to these markets won’t offset lost U.S. export to China, ASA continues to emphasize the need to reach an agreement that rescinds the current tariffs and allows soy growers to begin to restore this vital, number one export market.



NBB Letter to EPA: Small Refinery Exemptions Destroy Demand for Biodiesel

Today, the National Biodiesel Board (NBB) delivered a letter to Environmental Protection Agency Acting Administrator Andrew Wheeler asking that the agency fully account for small refinery exemptions in the annual Renewable Fuel Standard rules and “end the demand destruction for biodiesel.” The letter also asks EPA to set RFS biomass-based diesel volumes for 2020 at 2.8 billion gallons, consistent with the industry’s demonstrated ability to produce fuel.

In the letter, NBB Vice President of Federal Affairs Kurt Kovarik writes, “EPA must end the demand destruction for biodiesel – not as part of a deal to change the RFS rules; rather, as an integral part of the agency’s duty to ensure that the RFS volumes it sets are met.”

The letter thanks Acting Administrator Wheeler for increasing transparency around the agency’s granting of small refinery exemptions. However, the agency’s data dashboard now makes it easy to calculate the biodiesel demand lost to these exemptions, the letter points out.

“Between 2015 and 2017, the demand destruction for biomass-based diesel is more than 300 million gallons,” Kovarik writes in the letter. “Independent analysis further substantiates the demand destruction for biodiesel and renewable diesel,” he adds.



US Ethanol Stocks Edge Up

Domestic ethanol stocks rose for a third straight week, though below recent builds, even as blending demand increased and production dropped, Energy Information Administration data released Wednesday, Oct. 17, showed.

Total domestic ethanol inventories gained 109,000 bbl in the week ended Oct. 12 to 24.130 million bbl, 2.6 million bbl, or nearly 12%, higher than the corresponding week in 2017.

Plant production dropped 29,000 barrels per day (bpd) to 1.011 million bpd during the week-ended Oct. 12, 0.8% lower than the corresponding week in 2017. Four-week averaged production was 1.026 million bpd versus 998,000 bpd during the corresponding four week period in 2017.

Net refiner and blender inputs, a measure for ethanol demand, rose 11,000 bpd to 933,000 bpd during the week-ended Oct. 12, 1.2% lower than a year ago. For the four weeks ended Oct. 12, blending demand averaged 916,000 bpd, 11,000 bpd below the same period in 2017.



Fertilizer Prices Higher for Fifth Straight Week

Retail fertilizer prices continue to move higher slowly, according to prices tracked by DTN for the second week of October 2018. For the fifth week in a row, all eight major fertilizers were higher compared to a month earlier.

None of the eight, however, were up a significant amount. DAP had an average price of $501/ton, MAP $523/ton, potash $365/ton, urea $393/ton, 10-34-0 $452/ton, anhydrous $488/ton, UAN28 $238/ton and UAN32 $280/ton.

On a price per pound of nitrogen basis, the average urea price was at $0.43/lb.N, anhydrous $0.30/lb.N, UAN28 $0.43/lb.N and UAN32 $0.44/lb.N.



Study Finds That Larger Pigs Still Mean Tender Pork

In a consumer-driven business, the pork industry benefits from giving grocery shoppers what they're looking for.

So meat scientists' recent findings that consumers are routinely happy with larger cuts -- and the resulting tenderness profiles -- can be looked at as good news for pork producers.

"One of the results of increased genetics and improved nutrition is that the pork industry has been able to get pigs to heavier market weights a lot more efficiently," said Travis O'Quinn, a meat scientist with K-State Research and Extension.

"When we harvest those animals at heavier weights, the resulting impact is that we end up with larger cuts that come off those animals, ultimately resulting in larger pork chops when consumers go to the grocery store."

In taste-test panels conducted recently at Kansas State University, consumers rated pork from larger animals as more tender, and they actually preferred thicker cuts of meat in side-by-side visual comparisons with thinner cuts.

"We brought consumers in and fed them the pork chops and didn't tell them anything about them other than that they were pork chops," O'Quinn said. "The consumers' (responses indicated) that the bigger the animal was, the more tender the product was. When we looked at flavor and juiciness and how much they liked their product overall, there was no difference. We were able to see in the heavier-weight pigs that we did have more tender products."

Consumers also responded to questions related to packaging of pork. O'Quinn noted that larger cuts could mean that retail packages are larger, meaning that even though the price per pound remains the same, the overall price for larger cuts is higher compared to the overall price for thinner cuts.

O'Quinn said consumers mistakenly thought the price per pound was too high, rather than realizing that the overall price was higher due to the higher weight of the chops in the package.

"To our surprise, when we had the case with no information, the consumers generally liked the bigger chops," said Emily Rice, a K-State graduate student who conducted the study under O'Quinn's supervision. "But when we put the prices on there, there became a limit to how big those chops could actually be for the consumers to say they were willing to actually purchase them.

The study's results will be presented during the K-State Swine Day, scheduled for Thursday, Nov. 15, at the K-State Alumni Center in Manhattan. The study was supported by the National Pork Board and Minnesota-based Holden Farms.



U.S. Organic Certified Acres Now Totals 6.5 Million

Mercaris, a market data service and online trading platform for organic, non-GMO, and certified agricultural commodities, released its annual Organic and Non-GMO Acreage Report. In its report, Mercaris captures key statistics around the expansion of certified organic and non-GMO field crop farming and acreage across the U.S.

The report reveals that, as of August 2018, there are 17,648 U.S. farms certified as compliant with the USDA National Organic Program (NOP) standards for organic row crop production. This is an increase of almost 3% year-over-year, which represents 460 new operations across the country.

Altogether, Mercaris estimates the amount of U.S. land certified for organic crop production will total 6.5 million harvested acres for the current year, up 2% from the previous year's 6.4 million acres.

States along the East Coast, through the Corn Belt, and through the West reported the largest gains in total NOP certified crop operations, with the three regions adding a combined 430 certified organic crop operations. The report from Mercaris takes a deep dive into this data, providing a close look at organic alfalfa, corn, dry beans, peas, lentils, small grains, soybeans, and wheat. The report also analyzes non-GMO corn and soybean acreage.

The USDA NASS confirmed that it will not be issuing data on organic acreage for 2018, making the Mercaris Organic Acreage Report the only trusted information source in the country.



NGFA urges IRS to clarify 'dealing in commodities' provisions of proposed rules implementing Section 199A of tax law

The National Grain and Feed Association (NGFA) testified on Oct. 16 at an Internal Revenue Service (IRS) public hearing to recommend that the agency clarify a recently proposed rule to ensure agribusiness firms like grain elevators qualify for the 20 percent pass-through deduction under Section 199A of the tax code.

Earlier this year, the NGFA and other stakeholders raised considerable concerns about how an initial version of Section 199A of the tax code - approved during the waning hours of congressional consideration of the Tax Cuts and Jobs Act of 2017 - would influence producer marketing decisions. Congress responded by including stakeholder-driven provisions to fix the so-called "grain glitch" in the omnibus spending bill signed into law on March 23. The legislative solution achieved NGFA's objective to replicate to the maximum extent possible tax benefits to cooperatives and producers under the previous Section 199, while at the same time preserving a competitive marketplace.

On Aug. 16, the IRS published a proposed rule to implement certain provisions of Section 199A. Importantly, while the proposal has no impact on the legislative action taken by Congress in March, it does contain a provision regarding the deduction for qualified business income under Section 199A that the NGFA told the IRS needs to be clarified or revised.

The IRS-proposed rule would not affect taxpayers and entities organized as C corporations. However, it could be interpreted as excluding other entities - such as individuals, partnerships, sole proprietorships, S corporations and LLCs whose owners are individuals - that are defined by the IRS as "dealing in commodities" from deducting 20 percent of qualified business income from their taxes under Section 199A.

The NGFA noted the proposed rule does not classify as "dealing in commodities" such businesses as feed mills, flour mills, and grain and oilseed processing plants that transform raw commodities into animal feed or processed products. Likewise, the proposed rule acknowledges that engaging in hedging transactions as part of the trade or business of manufacturing or farming is not classified as "dealing in commodities." But as currently written, the NGFA said, the proposed rule could ensnare grain elevators and other businesses that receive, store and ship raw agricultural commodities without altering their physical state.

"The NGFA urges (that the proposed regulations) be modified to clarify and confirm that (companies whose facilities) take physical possession of commodities are expressly excluded from the definition of 'dealing in commodities,'" said Chris Hesse, principal in the national tax office of CliftonLarsonAllen, an associate member of the NGFA who testified on the association's behalf. "The (dealing in commodities) provision should apply only to the dealing in financial instruments - not taking physical possession (of the underlying commodities)."

Hesse stressed that the intent of Congress in excluding those "dealing in commodities" from the tax break was directed at firms engaged in trading financial instruments or derivatives, not grain elevators that take physical delivery of grains and oilseeds and invest capital in storage and handling infrastructure, and preserve and enhance the value of such commodities through such activities as drying, cleaning, aerating, fumigating, blending and transporting them to downstream customers.

Hesse pointed to several illogical outcomes that could result if the proposed rule is not changed. For instance, the proposed rule would cover commodities "actively traded" on futures exchanges, such as wheat, corn, soybeans, oats and milk, but left uncovered would be commodities for which futures contracts do not exist, such as sorghum, barley, triticale, hay and many others.

"Thus, there is a potential disparity in tax treatment for agricultural businesses based upon whether a particular commodity meets the test of being 'actively traded' on an exchange," the NGFA testified.

NGFA's oral testimony reinforced a written statement the association submitted to the IRS on Oct. 1, in which it stated that, "the intent of Section 199A is to provide a reduction in the tax rates for a trade or business, the income of which is a return on invested capital. The NGFA believes it was the clear intent of Congress that activities such as buying, selling, handling, processing and performing other value-added functions on physical commodities as part of the U.S. food and feed value chain reflect such a return on capital and should be eligible for the Section 199A deduction."

During the public hearing, the NGFA offered to continue to work with the IRS to ensure that regulations are accurate, complete and consistent with the legislative solution.