Thursday October 3 Ag News

Nebraska Farm Bureau Suggests Cattle Market Reforms to USDA

Nebraska Farm Bureau has offered the United States Department of Agriculture (USDA) a series of recommendations to reform the way beef cattle are marketed. The underlying concept of Farm Bureau’s suggestions are to create a more transparent and value-based system that would more closely link the prices farmers and ranchers receive for their cattle to the value of beef products sold at the wholesale and retail levels. Nebraska Farm Bureau President Steve Nelson shared the recommendations with U.S. Secretary of Agriculture Sonny Perdue in an October 2 letter.

“With only four major meatpackers, many Nebraska cattle producers have expressed concerns about the level of control that exists within the consolidated meat packing industry, specifically in the way of packer captive supplies of cattle and the diminishing cash market for live cattle. We believe reexamining the cattle pricing system and moving toward one where cattle prices and cattle contract prices are discovered under a more transparent and value-based system would be beneficial in addressing producer concerns and allow the cattle market to better respond to actual supply and demand conditions,” said Steve Nelson, Nebraska Farm Bureau president.

Beef producers’ concerns about the potential for anti-competitive actions in cattle markets heightened after a July fire at a Tyson meat processing facility in Holcomb, Kan. with producers seeing prices paid for cattle drop while meatpackers made significant profits. Nebraska Farm Bureau had urged, and USDA stepped forward, in investigating the situation under the powers given to the agency under the federal Packers and Stockyards Act; the long-standing legislation targeted to eliminating anti-competitive measures in livestock markets.

“We have no preconceived outcome in mind for the Packers and Stockyards investigation and our state’s cattle producers are grateful USDA is doing its due diligence. However, we believe the best way to address real or perceived manipulation concerns is to move to a value discovery system that more closely links what cattle producers receive for the beef they produce and the value of that product as it nears the end consumer,” said Nelson.

Nebraska Farm Bureau’s recommendations to USDA for changes under the Packers and Stockyards Act include:

    Create regulatory standards requiring that cattle marketing contracts have a set, negotiated base price before cattle are committed for delivery. 

    Assure that cattle marketing contracts utilize reference or base prices that are more broad-based and publicly available rather than the shrinking cash markets.

    Consideration of requiring contract standards that have reference prices or base prices that are more value-based such as using wholesale price cuts, retail meat values, or beef cut-out values. Requiring base or reference prices for cattle contracts that are more value-based up the beef supply chain would reduce, by market forces, any real or perceived incentives for packers to manipulate captive supplies in order to drive down local cash markets.

    Consideration to developing a live cattle value index which would be required to be used as a reference or base price standard for cattle marketing contracts.  The index could use a combination of average spot cash prices, average weekly close of nearby live cattle futures, weekly average of beef cutout value, and weekly average of retail meat values.  Using this live cattle value index would help ensure that cattle are marketed on a value discovery system rather than a price discovery system.   

“This has been a challenging year for Nebraska beef producers as weather, trade disputes, rising debt issues, increased input costs, and now difficult marketing conditions have created great stress on the largest sector of Nebraska’s agriculture-based economy. We appreciate the work USDA has done on many fronts for farmers and ranchers. It’s our hope Secretary Perdue and USDA will consider these ideas for reforms to move our beef industry forward toward a value-based cattle marketing system that would offer true reform,” said Nelson.



SOIL AND WATER: ANALYSIS IDS AG PRACTICES TO FIGHT FLOOD, DROUGHT

A synthesis of 89 studies across six continents has helped clarify which agricultural practices hold water when it comes to helping soils soak up precipitation — a factor critical to mitigating floods, outlasting drought and stabilizing crop yields.

The roots of the solution? Put down and preserve some, said the University of Nebraska–Lincoln’s Andrea Basche.

“There are a number of ways to improve water getting into the soil, but what we found to be the most consistent are the practices that offer continuous roots,” said Basche, assistant professor of agronomy and horticulture.

When acting like sponges, soils can alleviate the worst consequences of torrential rains that now strike with increasing frequency and are abruptly redefining terms such as “500-year flood.” Absorbent soils can also make the most of water when it’s most precious, allowing crops and other plants to better survive droughts that many researchers predict will become more severe going forward.

Though some agricultural producers have adopted management practices designed to minimize the disruption or maximize the enrichment of soils, little research has systematically compared how those practices influence water absorption, Basche said.

“We talk about a lot of (landscape) conservation practices as if they’re equal,” she said. “My perspective was that we didn’t have a good sense of the benefits that different practices provide.”

So Basche and the Union of Concerned Scientists’ Marcia DeLonge decided to analyze the effects of five emerging ag-related practices: no-till farming, cover crops, crop rotations, perennial plantings and cropland grazing.

Their meta-analysis found that planting perennials such as grasses or trees near cropland increases the rate of water absorption by an average of 59%. Cover crops — those planted primarily to combat erosion and restore soil nutrients — boosted water absorption by an average of 35%, according to data from 23 studies.

By contrast, the synthesized data from 52 studies found no overall effect from practicing no-till agriculture.

“That was probably the most surprising finding,” Basche said. “Very commonly, you hear people talk about how important no-till is to increasing (water) infiltration. There were some environments and management combinations where no-till led to an increase in infiltration, but on average, that’s not what we found.”

Rotating among cash crops also seemed to have no substantial influence, at least in the aggregate. Allowing livestock to graze on cropland, meanwhile, reduced water infiltration by an average of 21%, though the team found relatively few studies on the practice.

The differences that emerged from the meta-analysis could partly account for the flood-related phenomena that farmers have noticed and recounted over the years, Basche said. Nebraska farmer Noah Seim told the U.S. Department of Agriculture that a rye-heavy cover crop seemed to spare his land from the worst aftermath of the widespread flooding that hit the state in March.

“You hear all these anecdotes about soil health,” Basche said. “Producers love to tell these stories about, ‘I got this 6-inch rain event. My neighbor’s farm had flooding, and my farm let all that water soak into it.’ I’ve heard (versions of) that story numerous times.”

Prior research has suggested that the continuous presence of root systems, like those that perennials and cover crops can offer, may open up more pores for water to infiltrate, Basche said. Undisturbed soil might also encourage more biological activity, such as the burrowing of earthworms, that does the same.

“It’s hard in an analysis like this to say exactly what’s the process behind that,” Basche said. “But when you put these (practices) all together, you can see the relative differences and make some new hypotheses about what might be impacting infiltration.”

Basche recently returned from Washington, D.C., where she presented to a congressional caucus focused on soils. After illustrating the post-1980 jumps in heavy rainfall across much of the United States, Basche shared lessons from the meta-analysis, other research and an ongoing study of 17 field sites across Nebraska.

Part of the challenge ahead, she said, lies in demonstrating the value and feasibility of soil-friendly practices to agricultural producers. Less than 10% of U.S. cropland, for instance, currently supports cover crops.

“Ultimately, with anything that we do research on in agriculture, it has to work on the farm,” Basche said. “We have to figure out how to do it and how to make it economically sustainable, too.

“But when it comes to improving outcomes with heavy-rain events, I think this work illustrates that soil can be a solution.”

Basche and DeLonge published their findings in the journal PLOS ONE. They received support from the Union of Concerned Scientists, the TomKat Foundation and The Grantham Foundation for the Protection of the Environment.



ACE welcomes ethanol producer members Heron Lake BioEnergy and Southwest Iowa Renewable Energy

The American Coalition for Ethanol (ACE) recently welcomed two new ethanol producer members Heron Lake BioEnergy (HLBE) located in Heron Lake, Minnesota, and Southwest Iowa Renewable Energy (SIRE) located in Council Bluffs, Iowa.

HLBE’s 65-million-gallon-per-year (MGY) plant provides jobs to 40 full-time employees and has approximately 1,200 investors. “Over the years, I have been able to see and experience the value ACE offers first hand,” said Kenton Johnson, HLBE and ACE board member. “ACE provides the best value in the industry. The return on investment for ACE’s policy and market development work is bar none the best in the business. In a time where our industry is working with difficult margins, it is more important than ever to invest in trade organizations that keep up the fight for ethanol’s access to the market.”

The 130 MGY SIRE ethanol plant employees 62 people and has over 800 investors. SIRE hosted President Trump to celebrate the lift on the summertime E15 ban this past June. SIRE CEO, and 18-year veteran of the ethanol industry, Mike Jerke said, “joining ACE was an initiative we wanted to accomplish this year.”

“ACE’s grassroots approach to public policy and market development is top notch, making the decision to join an easy one,” Jerke added. “They work with the folks who are in the trenches on environmental policy and international market development. Their proven experience and expertise in these areas only strengthened our cause for joining. We need industry champions who are willing to help place us in an offensive position, ACE is doing just that. We look forward to our continued work with this organization.”

“ACE is proud to represent farmer and community-owned ethanol plants,” said Liz Bunkers, ACE Director of Member and Industry Relations. “We take great pride in being a voice for farmers and ethanol producers who are committed to making a superior renewable product that supports local agriculture and lowers greenhouse gas emissions. With the addition of Heron Lake BioEnergy and Southwest Iowa Renewable Energy, ACE is growing our membership roster to represent a bigger slice of rural America.”



Survey Finds Strong Opposition to EPA Oil Refinery Waivers, Strong Support for RFS

Registered voters oppose the Trump administration’s actions to exempt oil refineries from renewable fuel blending obligations by a margin of nearly two to one, according to new polling data released today by the Renewable Fuels Association. The nationwide survey, by Morning Consult, also found strong support for ethanol and the Renewable Fuel Standard. In fact, support for the Renewable Fuel Standard reached its highest level since RFA began polling on RFS support in 2016.

“The massive increase in secretive small refiner waivers has been all over the news recently and we wanted to find out how registered voters really feel about the EPA giving highly profitable oil companies a free pass to ignore their Clean Air Act obligations,” RFA President and CEO Geoff Cooper said. “Not surprisingly, the overwhelming majority of voters with an opinion on the issue opposed the small refinery exemptions. At the same time, public support for the RFS reached its highest rate since we began polling on the issue more than three years ago. As the White House and EPA move to finalize a relief package to mitigate the negative impact of these refinery waivers on rural America, we hope they take this information into account. It’s time for EPA to follow the law and implement the RFS as intended by Congress.”

The survey of nearly 2,000 voters found opposition to the refinery waivers, with 55 percent of respondents opposed compared to 29 percent supporting and 17 percent having no opinion.

When it comes to ethanol, the survey found 64 percent of voters have a favorable view, with support reflected across all key demographics, regardless of gender, location and political party. Support for the Renewable Fuel Standard, at 62 percent, represented an increase of six percentage points from May 2018 and was the highest since RFA began regular polling with Morning Consult on the rate of support for the RFS in 2016. The percentage of respondents indicating “strong support” for the RFS also hit its highest level since RFA started polling. Only 13 percent of respondents opposed the RFS, the lowest rate since polling began on RFS support.

The top reasons cited for a favorable opinion for ethanol are the environmental benefits of ethanol, the fact that renewable fuels are domestically produced, and that they offer consumers an affordable choice at the pump.

The poll was conducted by Morning Consult for RFA between Sept. 26-28, among a national sample of 1,998 registered voters. The interviews were collected online and the data weighted to represent a target sample of voters based on age, race/ethnicity, gender, education attainment and region; results have a margin of error of plus or minus two percentage points.



NCBA Exposes Relationship of OCM and HSUS

The National Cattlemen’s Beef Association Vice President of Government Affairs, Ethan Lane, today released the following statement in response to a Nebraska rally demanding government intervention to alleviate price disparities impacting cattle markets:

“Yesterday, an HSUS-funded organization called the Organization for Competitive Markets (OCM) held a rally in Omaha, Nebraska entitled the “Rally to Stop the Stealin’ (sic)”.  According to OCM, this event was intended to place pressure on the Trump Administration and U.S. Department of Agriculture (USDA) Secretary Sonny Perdue to “fix” our cattle markets in response to the price disparity producers are currently having to endure.

“First and foremost, I think it’s important to make clear – once again – that these producers have every right to be angry. Down markets are horrible, and can leave a wake of financial and operational hardships that can persist for years after the boards in Chicago have moved on. Our stance remains consistent: NCBA is committed to the USDA’s investigation into the events surrounding the Holcomb plant fire and stand ready to respond to the results of that investigation to ensure that our members – 95 percent of which are boot-on-the-ground producers – have a fair market in which to thrive. Unfortunately, this continues to be the focus of much of HSUS and OCM’s misinformation and deception campaign. What’s worse, they’ve found willing allies in the leadership of both the U.S. Cattlemen’s Association and R-CALF.  

“It’s no secret that our industry is divided at the moment. I’ll be the first to stand up and say that a healthy debate about the future of our industry is appropriate as we see tremendous advances in technology, production practices, conservation, quality, and markets. However, these discussions need to be amongst those who love, work, and make their living in this industry. Regardless of our positions, we must stand together against the onslaught of detractors and dividers that do not care about our internal struggles. These outside forces want to end animal agriculture – full stop. Chief among them HSUS, and anyone who watched yesterday’s rally witnessed that point illustrated in high definition.

“These people have told us who they are. In 2012, OCM President Fred Stokes told a crowd that “…every cowboy out there owes a debt of gratitude to the Humane Society of the United States.” Further, on their website, OCM argues passionately on behalf of HSUS’s work to end our industry. Finally, OCM’s executive director is a well know and unapologetic HSUS operative, as outlined by Protect the Harvest several years ago.

“As if to add insult to injury, yesterday’s event included pleas for President Trump to be voted out of office in favor of Elizabeth Warren, among other positions that likely don’t reflect the views of most cattle producers I know. Oh, and they served turkey for lunch. Around this office, we don’t even serve turkey at Thanksgiving.

“There’s an old saying that most definitely applies here; if it looks like a duck, and walks like a duck, and quacks like a duck, and if the duck TELLS you it’s a duck, believe it.”
 


Dairy Products August 2019 Production Highlights

Total cheese output (excluding cottage cheese) was 1.11 billion pounds, 2.2 percent above August 2018 and 1.6 percent above July 2019.  Italian type cheese production totaled 457 million pounds, 0.8 percent above August 2018 but 1.8 percent below July 2019. American type cheese production totaled 458 million pounds, 5.1 percent above August 2018 and 4.7 percent above July 2019.  Butter production was 136 million pounds, 2.1 percent above August 2018 but 4.3 percent below July 2019.

Dry milk products (comparisons in percentage with August 2018)
Nonfat dry milk, human - 132 million pounds, up 2.5 percent.
Skim milk powder - 51.4 million pounds, up 8.0 percent.

Whey products (comparisons in percentage with August 2018)
Dry whey, total - 84.5 million pounds, up 7.2 percent.
Lactose, human and animal - 92.8 million pounds, down 4.6 percent.
Whey protein concentrate, total - 39.6 million pounds, down 7.7 percent.

Frozen products (comparisons in percentage with August 2018)
Ice cream, regular (hard) - 65.7 million gallons, down 6.4 percent.
Ice cream, lowfat (total) - 40.2 million gallons, down 3.8 percent.
Sherbet (hard) - 2.48 million gallons, down 23.8 percent.
Frozen yogurt (total) - 3.79 million gallons, down 5.4 percent.



SSGA speaks up for identity-preserved farmers in D.C. testimony

Identity-preserved (IP) crop farmers were represented at a hearing Wednesday about China’s compliance with its commitments to the World Trade Organization (WTO), regarding China’s current zero threshold presence limit placed on imports of non-genetically modified (non-GM) field crops.

On behalf of the Specialty Soya and Grains Alliance (SSGA) and with coordination and support of the U.S. Soybean Export Council (USSEC) and American Soybean Association (ASA), SSGA Executive Director Eric Wenberg provided testimony to the Trade Policy Staff Committee (TPSC) in preparation of the Office of the United States Trade Representative’s (USTR) annual report about China’s compliance with WTO rules. Wenberg was one of six individuals providing testimony on a range of issues, including intellectual property among others.

Non-GM food variety soybeans from the United States have been excluded from Chinese imports, although genetically modified soybeans are allowed for import, due to China’s lack of a nonzero low level presence threshold allowing for biotech soybeans to be mixed in.

“Farmers growing identity-preserved and non-GM crops must abide by stringent standards to produce specific varieties and traits to produce food for customers around the globe,” Wenberg said. “They deserve an additional market opportunity for their products. The soybean industry’s concern about this issue helps draw attention to the need to see a solution to this problem along with the other barriers to U.S. product sales. According to customs and trade data, food variety soya exports to all destinations for IP can reach $1.7 billion (2018), but we could sell more if the China market was open to us.”

IP soybeans and specialty grains are grown coast-to-coast, but are predominately exported from North Dakota, Minnesota, Iowa, Illinois, Indiana, Michigan, Ohio, Arkansas and Wisconsin.