Tuesday October 8 Ag News

The NCB Co-op 100 Reports Top Producing Cooperatives with Revenues of $222.2 Billion

On Monday, the National Cooperative Bank, known for providing banking solutions tailored to meet the needs of cooperatives and their members nationwide, released its annual NCB Co-op 100®, listing the nation’s top 100 revenue-earning cooperative businesses. In 2018, these businesses posted revenue totaling approximately $222.2 billion. The NCB Co-op 100® remains the only annual report of its kind to track the profits and successes of cooperative businesses in the United States.

“The theme for Co-op Month this year is: Co-ops: By the Community, For the Community”, stated Charles E. Snyder, president and CEO of National Cooperative Bank. “Cooperatives are unique because they operate for the benefit of their member-owners and communities. Having a vested interest in the co-op fosters a natural closeness and accountability between owners/members and management. We know this is a successful and sustainable business practice, since co-ops have been doing it for 175 years.”

The following are the top revenue producers in 2018 for the NCB Co-op 100's main sectors:

Agriculture:
• CHS Inc., based in Inver Grove Heights, Minnesota reported $32.7 billion in revenues in 2018 and maintained its first place position on the NCB Co-op 100® list.
• Land O’Lakes, Inc., based in Saint Paul, Minnesota reported $14.9 billion in revenues, earning the number two ranking this year.

Grocery:
• Wakefern Food Corporation/ Shoprite, based in Keasbey, New Jersey reported $13.1 billion in revenue, earning the fourth ranking again this year.
• Associated Wholesale Grocers, Inc., based in Kansas City, Kansas reported revenue of $9.7 billion and earned the fifth position on the list.

Hardware & Lumber:
• ACE Hardware Corp., based in Oak Brook, Illinois earned $5.7 billion in revenue and came in at number nine on the list.
• Do-it-Best Corp., located in Fort Wayne, Indiana earned the 12th place on the list, with $3.7 billion reported in revenue.

Finance:
• Navy Federal Credit Union, headquartered in Merrifield, Virginia, earned $6.9 billion in revenues and is number eight on the list.
• CoBank, headquartered in Greenwood Village, Colorado earned $4.3 billion and came in 10th on the list.

Healthcare:
• HealthPartners Inc., located in Bloomington, Minnesota earned $7.0 billion in revenue and is seventh on the list.

Energy & Communications:
• Basin Electric Power Cooperative, located in Bismarck, North Dakota earned the 16th position with a reported $2.4 billion in revenue in 2018.
• Oglethorpe Power Corporation, located in Tucker, Georgia earned the 29th position with reported revenue of $1.5 billion in 2018.

Nebraska-based Cooperatives that made the list include:
(rank, name, town, 2018 revenue)
11) Ag Processing, Inc., Omaha - $4.154b
21) Central Valley Ag, York - $1.656b
26) Farm Credit Services of America, Omaha - $1.571b
35) Producers Livestock Marketing Assoc., Omaha - $1.393b
56) Aurora Cooperative, Aurora - $1.01b
70) Farmers Cooperative, Dorchester - $824m
78) Frenchman Valley Farmers Cooeprative, Imperial - $695m
86) Cooperative Producers, Inc., Hastings - $637m

Others of note:
3) Dariy Farmers of America, Kansas City, MO - $13.63b
44) Landus Cooperative, Ames, IA - $1.172b 
53) NEW Cooperative, Inc., Fort Dodge, IA - $1.078b
59) Heartland Cooperative, West Des Moines, IA - $941m

While the companies and rankings change each year, the cooperative sector continues to advance, playing an increasingly influential role in the national and global economy. Released annually in October during National Co-op Month, the NCB Co-op 100® is just one way the Bank strives to educate and promote the importance of this sector.

As a long-time advocate for cooperatives, NCB’s mission is providing critical financing to support the growth and expansion of cooperative businesses, while also deploying hundreds of millions of dollars to support underserved communities and cooperative expansion initiatives.

Although similar to other business models, a cooperative has several unique features. It is owned and controlled by its members, who have joined together to use the cooperative’s goods, services and facilities. A board of directors, elected by the membership, sets the cooperative’s policies and procedures. By pooling resources, members can leverage their shared power to buy, sell, market, or bargain as one group, achieving economies of scale and sharing in any profits generated. In addition, communities benefit both socially and fiscally by the cooperatives’ ability to access and deliver goods and services from across the nation.



ICON calls on Washington, D.C. to restore fairness to markets, label beef honestly

The Independent Cattlemen of Nebraska join other agriculture groups in calling for a stern rebuke if not the removal of USDA Sec. Sonny Perdue, who clearly believes economic opportunities only belong to the biggest companies.

Perdue recently told a group of Wisconsin dairy producers, “In America, the big get bigger and the small go out” -- ignoring the family farmers who sit on school boards, church boards, volunteer fire departments, have bake sale fundraisers and pay taxes to support local schools.

Concentration in farm and food markets has been accelerating at a rapid pace. A handful of corporations now virtually control the inputs, production and distribution of our food.

That concentration incentivizes those companies to engage in unfair and discriminatory acts that cause ranchers and farmers to receive less than a competitive price for their livestock and crops, said Al Davis, a member of the board of directors of ICON and the group’s legislative chairman.

Davis recently addressed some 400 people at a “Stop the Stealin” rally Oct. 2 in Omaha that motivated ag producers to call for fair markets and fair trade.

Davis noted that when a cattle producer loses $500 per head, the loss is not only felt on the ranch, but also in the community and the state.

Ranchers have lost around 30% of their share of the retail beef dollar over the last several years. Combined with low market prices, losses can amount to $1,000 per head. Millions of head of cattle are produced in Nebraska. 

Lawmakers must take action to ensure fair markets for producers, Davis said.

There are six actions the USDA could take immediately to restore fairness to farm markets. The most basic improvement would be to stop imported foreign meat from being labeled a “Product of the USA.”

When country of origin labeling (COOL) of meat was rescinded, it allowed foreign meat that is imported into the U.S. to be re-wrapped during processing and labeled “Product of USA.”

More than 14 months ago, the Organization for Competitive Markets (OCM) and the American Grassfed Association (AGA) filed a petition with Sec. Perdue’s Food Safety Inspection Services agency to stop this deception and ensure only U.S. domestic meat products can be labeled “Product of USA.”

The Food Safety and Inspection Service labeling practice must use an ingredient-based definition and not a processed-based definition, Davis said.

“We have a choice,” he said. “We can sit on our hands or we can work together as ranchers to fight for a fair and balanced market, fair and balanced labeling, fair and balanced trade, and a fair and balanced approach by the Secretary of Ag to our problems and our needs.”

Davis also noted that four processing companies now control 80% of the beef in the US, and two of the companies are foreign owned. 

He also said anti-trust protections of the Packers & Stockyards Act have been undermined, and called on the USDA to require Livestock Mandatory Price Reporting to be shared with the USDA Packers and Stockyards administration.

ICON also joins many other groups in calling for COOL to be included in the US-Mexico-Canada trade agreement.

“It’s time for us to send a message to Washington that we’re sick and tired of being screwed and we’re not going to take it anymore,” Davis said.



Prioritize Flu Vaccinations to Protect People and Pigs

As we move into fall, there are many on-farm tasks that need to be adjusted, such as ventilation and rodent control. One practice that needs to be added to the list is influenza protection, specifically to prioritize flu vaccinations for everyone working on a pig farm.

“Everyone associated with the farm should be vaccinated whether they work directly with pigs or not,” said Heather Fowler, DVM, director of producer and public health for the Pork Checkoff. “That is the best thing producers can do to protect their families, co-workers and pigs from the flu.”

In fact, a seasonal flu vaccination is a public health recommendation and part of the One Health approach to protect people, pigs and the global environment. The Centers for Disease Control and Prevention (CDC) recommends that everyone 6 months of age or older be vaccinated annually against seasonal influenza. The seasonal influenza vaccine is available now, so people should be vaccinated as soon as possible to prompt their immune system to prepare for flu season, which typically stretches from October to May.

“Equally important, farms need to have sick-leave policies in place that encourage workers to stay home if they are suffering from flu-like like respiratory symptoms,” Fowler said. “While it’s especially important to stay off the farm, people need to stay away from public places and take time to rest and recover. This will help shorten the duration and impact of the infection.”
Influenza is a virus, and infections can last three to seven days, although a cough can persist for more than two weeks.

“People with active infections can be contagious for several days,” Fowler said. “They should not return to work for at least 24 hours after their fever breaks without using a fever-reducing medication.”

Other on-farm practices should receive extra attention this time of year, including reviewing the Pork Quality Assuance® Plus (PQA Plus®) section that addresses influenza. Here are a few critical steps:
-    Animal caretakers should wash their hands and arms frequently with soap and water. Keep hands away from mouth, nose and eyes.
-    Monitor animal health daily and contact the herd veterinarian immediately if influenza is suspected. A rapid response is helpful when treating sick pigs and may also minimize losses and further spread.
-    Maintain proper building ventilation and barn hygiene to help reduce influenza virus transmission.
-    Ensure bird and rodent control programs are well established.
-    Do not allow anyone with flu-like symptoms to enter the facility, and ask visitors about recent contact with others who may have been ill.
-    Restrict eating in animal areas.

“The good news is that seasonal flu vaccinations are widely available today, including convenient options, such as a quick stop at the local pharmacy or clinic,” Fowler said. “Influenza can be addressed effectively through vaccinations, which help reduce the duration, intensity and spread of the virus. Producers are committed to protecting swine health and welfare, as well as public health. Getting vaccinations and following protocols to reduce the potential transmission of influenza this season is one more step in doing what’s right for people, pigs and the planet.”



African Swine Fever
Brenda Boetel, Dept of Ag Economics, University of Wisconsin - River Falls

By now every livestock producer has heard of African Swine Fever (ASF), the highly contagious disease with no known vaccine that is devastating the hog herd in China. ASF was first detected in China in August 2018 and has since spread to every mainland Chinese province as well as Hong Kong. China's hog herd has shrunk between 25% and 50% (depending on which Chinese agency is reporting the numbers). The decline in pork production, according to the National Bureau of Statistics of China, is decidedly smaller and estimated at 20%. One shouldn't expect total pork production to be down the same as hog herd size, as sow culling is being reported at a higher percentage than market hogs. Thus, short-term pork production may not decline as much as herd size, but the long-term effects will continue into 2020. Regardless of the decline in Chinese pork production, the gap between Chinese supply and Chinese demand will be filled by either imported pork, or substitution of an alternative protein product.

Chinese pork imports are up 30% year over year for the January through August time period. Spain is the top pork exporter to China followed by Germany, Canada, Brazil and the USA. Chinese imports from the USA are up 38% year over year, but account for only 4% of US pork production. The large increase reflects both the uptick due to ASF and the downtown in 2018 due to trade concerns. Chinese imports didn't start to increase significantly until the third quarter of 2019. Given the continual tightening of Chinese supply, the fourth quarter of 2019 and 2020 will see increased Chinese imports, likely coming from a combination of Canada, Brazil and the US.

The 38% growth in exports to China has been offset by weaknesses in other exports to other Asian countries and Mexico, allowing for only a 4% growth year over year in total US export quantity. The strong dollar and disruptive trade policies have dampened the potential growth in US pork exports and will continue to slow export growth to China and other countries.

Prior to the outbreak of ASF, China consumed approximately 73 pounds per capita of pork, 13 pounds of beef and 25 pounds of poultry. Chinese pork consumption is expected to drop sharply in response to soaring prices, as well as lack of physical supply. In an attempt to curb price increases (and resulting inflation) reserve pork supplies have been released and price ceilings have been created. Nevertheless, Chinese pork prices have increased between 33% to 100% since January. Additionally, retail prices for sheep, beef and chicken are also at record levels.

China has increased beef imports approximately 57% over the same period in 2018. US beef export quantity to China has increased 24% over 2018 but note this is still less than 1% of total US beef export quantity. Given that Chinese beef imports are increasing at a faster rate than pork, and that Chinese beef and poultry prices are at record levels, one can assume there has been some substitution from pork consumption to alternative proteins.

ASF will have long-term effects on Chinese protein consumption and world protein exports. US-China trade war limits export opportunities and EU is relatively high priced. Poultry production has increased in China due to the much shorter production cycle than either pork or beef and poultry's similar price point to pork. If Chinese consumers switch to poultry in the short-run to accommodate the Chinese pork shortage, it will take some time for Chinese pork consumption to rebound. Nevertheless, pork exports into China will increase, although the amounts will be less than hoped for due to the political landscape. US pork producers and exporters should see year over year prices.



EIA Projects 1.9% Year-on-Year Decline in 2019 Ethanol Production

The Energy Information Administration expects ethanol production to average 1.03 million barrels per day (bpd) this year and in 2020, down 20,000 bod, or 1.9%, from 2018, according to its latest Short-term Energy Outlook released this afternoon.

EIA projects a 0.3% year-on-year growth rate in domestic ethanol consumption in 2020 after a 0.3% decline this year and 0.4% falloff in 2018 from 2017.

Biodiesel production is expected to edge 5,000 bpd up to 124,000 bpd this year from 2018, and to climb to 145,000 bpd in 2020.

In its outlook, EIA projects an 11.7% annual increase in U.S. biodiesel consumption this year and 10.7% year-on-year growth rate for 2020.



Registration Opens for RFA’s 25th Annual National Ethanol Conference

Registration is now open for the Renewable Fuels Association’s 25th annual National Ethanol Conference (NEC), to be held Feb. 10-12, 2020, in Houston. This year, with the theme “Focus Forward,” attendees will have the opportunity to look ahead to what the next quarter-century will bring for the U.S. ethanol industry, said RFA Board Chairman Neil Koehler, co-founder and CEO of Pacific Ethanol.

“For the past 25 years, this conference has been bringing the industry and its allies together to learn, share, network and celebrate our hard work,” Koehler said. “There will be so much to talk about in 2020, from presidential politics to increased calls for action on climate concerns. At the same time we’re talking about politics and policy, we’re also moving forward when it comes to building new markets, driving efficiency and advancing sustainability.”

The NEC is the nation’s most widely attended executive-level conference for the ethanol industry. At the 2019 NEC, about 1,000 industry leaders and professionals attended, representing 38 states and the District of Columbia. A strong international presence was also felt, with attendees from 16 countries.

The annual conference provides an unequaled opportunity to engage key decision makers and industry executives about the latest opportunities and challenges affecting the industry today. Speakers will address numerous topics, and RFA looks forward to offering attendees robust discussions around new uses and technologies, policy and politics, the market outlook, and the future vision for high-octane, low-carbon fuels.

Early bird registration provides substantial discounts until Nov. 22. For more information and to register, visit www.NationalEthanolConference.com. Make sure to also follow NEC on Twitter, at @EthanolConf, for updates. 



Culver's Thank You Farmers Project Donations Reach $2.5 Million

Culver's and its Thank You Farmers Project has raised $2.5 million to support agricultural education since its inception six years ago. So far in 2019, over $400,000 has been raised.

By 2050, the global population is expected to reach 9.8 billion, meaning we'll have to produce 80% more food than we do today to feed everyone. Money raised through Culver's supports programs such as FFA and others that are educating our country's future agricultural leaders.

"We're facing a turning point in agriculture, and the responsibility to feed a growing population falls on all of us, not just farmers," said Joe Koss, president and CEO at Culver's. "Our guests understand this, and that's why they've helped us to raise money every year to support the future of agriculture."

In addition to supporting agriculture education efforts, Culver's is joining the efforts of national organizations in support of agriculture's future. Mr. Koss is a newly appointed member of the U.S. Farmers & Ranchers Alliance (USFRA) board of directors. USFRA represents farmer and rancher-led organizations and food agricultural partners with a common vision to further our global sustainable food systems.



Online Registration Open for AFBF’s 2020 Annual Convention

Online registration is open for the American Farm Bureau Federation’s 101st Annual Convention & Trade Show, Jan. 17-22, 2020, in Austin, Texas. Attendees will learn about the policies and perspectives affecting their farms, ranches or agribusinesses and gain deep insight into current trends impacting food production.

With a focus on AFBF’s theme for the year, 2020 Vision: Sustaining America’s Agriculture, the convention will bring thousands of farmers and ranchers from around the country together to hear from powerful speakers on subjects ranging from trade, broadband and the farm economy to business development, consumer engagement and technology. Advocacy and member engagement and development will also be featured topics.

The trade show provides hands-on access to innovative products and services from highly regarded industry leaders. At the Cultivation Center, on the trade show floor, attendees can enjoy TED-style talks as well as hear the Farm Bureau Ag Innovation Challenge finalists pitch live to the Challenge judges.

“Agriculture is at a crossroads and it has never been more important for farmers and ranchers to have the latest information about the challenges and opportunities we face,” said AFBF President Zippy Duvall. “Our convention is unique in its ability to inform, engage and unite farmers and ranchers.”

Register for the American Farm Bureau Federation’s 101st Annual Convention online here:  https://annualconvention.fb.org/.