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Farm program considerations: Part 6

Agpolicy | Posted on November 30, 2016

In this series of columns, we have argued that a) governmental farm program programs are necessary because of the inability of aggregate agriculture on both the supply and demand sides to adjust to low prices in the short-to-medium run, b) current farm programs are ineffective in dealing with the price/income problems that result from extended periods of low prices, c) current farm programs are more expensive than alternative policies that treat the cause of these low price periods, and d) a government supply management program that puts the relatively small amount of a crop that is in excess of current demand into a reserve deals with the cause of chronic low prices (for a fuller discussion of these and related ideas, see, columns 845 to 850). Early on in the supply management program in the US, when farmers forfeited the portion of their crop used as the basis for a government crop marketing loan in lieu of paying off the loan plus accumulated interest, the ownership of that portion crop was transferred to the Commodity Credit Corporation (CCC), a government entity. The farmer was not able to sell the crop until a release price was reached at which time the farmer was could sell the crop and use the proceeds of the sale to pay off the loan plus interest. The farmer would be able to keep the difference between the sale price and the loan payoff. Now let’s look at the difference between the two ways of holding the reserve. When the CCC held the reserve, if the price was not reached, even if it was just a nickel or a penny away from that level, the crop was not sold. The interest of the government in this program was to provide a reasonable, predictable, stable price band that benefitted both producers and crop consumers and was not in receiving the immediate profit. Crop users may have wanted to gain access to the crop, but until the release price was reached it remained in storage.

Obama taps Tonsager to lead Farm Credit

Agri-Pulse | Posted on November 29, 2016

President Barack Obama appointed Dallas Tonsager to the position last week but the selection was announced today. Tonsager, who was appointed to the FCA board last year, replaces Kenneth Spearman, who has held the job since March 2015.  Tonsager is currently board chairman of Farm Credit System Insurance Corporation. He previously served on the boards of FCA and FCSIC from 2004 to 2009 during the George W. Bush administration.  Tonsager was also the USDA's under secretary for Rural Development during Obama's first term, but resigned that post in early 2013. Before that, he co-chaired the department's transition committee in 2009 after co-chairing Obama's first farm and rural campaign committee in 2008.  Tonsager's term as FCA chairman and CEO expires in 2020. Barring unforeseen circumstances, the incoming Trump administration will not have an opportunity to name a chairman until then. Trump, however, will have the chance to fill a seat on the board to replace Spearman. That appointee will require Senate confirmation.

The Trump effect on fo

Meat + Poultry | Posted on November 18, 2016

The possible implications of the election is the topic of a recent reportpublished by the Rabobank Food & Agribusiness Research and Advisory (FAR) group.  “Republican-controlled Executive and Legislative branches could mean swift action when the new administration takes office,” according to Pablo Sherwell, Rabobank’s head of food and agribusiness research and advisory, North America. “Our analysts and others around the world are keeping a close eye on trade, labor, the upcoming Farm Bill and regulations impacting production agriculture, as these areas are where potential policy changes could have longer-term implications on the industry as a whole.” For the short term, agricultural markets may have foreign exchange volatility and uncertainty with the lack of market information. In the long term, Rabobank and others will look at trade agreements, agricultural policy and labor policies and business regulations to see how it affects economic growth.

Report: Trump to order Committee on Foreign Investment in the U.S. to examine food security

Tri State Livestock News | Posted on November 18, 2016

As part of a trade agenda that would begin on the first day of his presidency, President-elect Donald Trump “would order the Committee on Foreign Investment in the U.S. to review food security in trade and reciprocity in international corporate takeovers (i.e. whether a U.S. company would be able to buy a Chinese company like a Chinese company would be able to be buy a U.S. company),” CNN said. CNN said it got the information from a Trump transition memo it had obtained.  Meanwhile, Senate Judiciary Committee Chairman Charles Grassley, R-Iowa, said he had received answers to questions he had posed to ChemChina about its planned acquisition of Syngenta, a Swiss company that has substantial operations in the United States, but that he still has concerns about ChemChina’s “possible use of the Foreign Sovereign Immunities Act.”

CDC efforts on antibiotics use in pork in focus this week

Meatingplace (registration required) | Posted on November 18, 2016

The U.S. Centers for Disease Control (CDC) has launched its annual “Get Smart About Antibiotics Week” program, designed to provide information on progress to help the industry promote responsible use of antibiotics in pigs. The agency has set a goal of slowing the development and spread of antibiotic-resistant infections through improving the way antibiotics are prescribed and used, according Dr. Lauri Hicks, director of the CDC’s Office of Antibiotic Stewardship, in a news release. To that end, the CDC is using a $160-million allocation from the U.S. Congress to support additional research projects and to inform the industry and the general public on responsible antibiotic use and antibiotic resistance.

Critics: Monument plan would nix logging, grazing

Capital Press | Posted on November 18, 2016

Cattle and timber industry representatives say the proposed expansion of the Cascade-Siskiyou National Monument will lead to lost grazing lands and timber production and injure the area’s economy.  In October, Oregon Sens. Jeff Merkley and Ron Wyden, both Democrats, asked the U.S. Department of the Interior to expand the monument’s border by about 50,000 acres, much of which would involve Bureau of Land Management lands. The existing 62,000-acre monument in Southern Oregon was designated by then-president Bill Clinton in 2000.  A loss of cattle grazing in the area that abuts the Oregon-California state line would result in increased wildfire fodder in an already dry, hot and fire-prone area, the Oregon Cattlemen’s Association asserts.  Moreover, adjacent private landowners could lose access to their properties if roads are not maintained or gates become permanently locked, said Jerome Rosa, the OCA’s executive director.  e designation would be “potentially devastating” to the timber industry, taking “a lot of volume off the table,” said Travis Joseph, president of the American Forest Resource Council. Existing timber sales on the land “could be grandfathered in,” he said, “but we’ve seen with other monument proposals that timber sales that are grandfathered in don’t actually get implemented.”

FDA Finalizes Report on the Regulation of Combination Drug Medicated Feeds

FDA | Posted on November 18, 2016

A working group at the U.S. Food and Drug Administration’s Center for Veterinary Medicine (CVM) has finalized its report on proposed changes to improve the efficiency of approvals for the use of multiple new animals drugs in combination drug medicated feeds, while still protecting public health. These proposed changes are consistent with a performance goal in the Animal Drug User Fee Amendments of 2013 (ADUFA III) goals letter and are based on public comment. This report will be used in discussions concerning the reauthorization of the animal drug user fee program for five additional years through fiscal year 2023 (ADUFA IV).  As required by the Animal Drug Availability Act (ADAA), the use of multiple new animal drugs in the same medicated feed, also known as a combination drug medicated feed, requires animal drug sponsors to seek approval for each new animal drug used in the combination, and to seek separate approval for the combination drug itself.

Weeks To Sift Through New Zealand Rubble, Producers Dumping Milk

Ag Web | Posted on November 17, 2016

Aftershocks are still being felt in New Zealand as the country tries to recover from a massive earthquake, and the devastation will impact the major dairy producing nation from exporting its goods. Fonterra, the world’s biggest dairy exporter, said some of its farms were without power and would likely have to dump milk, while other shipments are expected to be late.  That area accounts for roughly 13 percent of the New Zealand’s milk output. Analysts expect the earthquake to lift milk prices at the Global Dairy Trade event.

Election has ripple effect on consumer food demand: report | Posted on November 17, 2016

Consumers were significantly less likely to pay for food across several categories in November and last week's elections may have contributed to the sharp decline, according to Oklahoma State University's latest Food Demand Survey (FooDS) monthly survey.  Ag economists say the decline in willingess-to-pay may reflect “post-election uncertainty,” as the surveys were completed just two and three days after the Nov. 8th vote. For meat products, the drop in willingness-to-pay was greatest for chicken wings — after an increase that category a month ago — with a 19.5 percent decline, to $2.07 per pound. Next-largest was steak, with a 13.4 percent drop to $6.77 per pound.

Free webinars available on whole farm revenue protection

Center for Rural Affairs | Posted on November 17, 2016

Do you produce fruits, vegetables or other specialty crops? Are you interested in protecting your crops with crop insurance, but struggling to find crop insurance that works for the diversity of fruits or vegetables you produce on your operation?  Or maybe you’re a crop insurance agent who is interested in strengthening crop insurance options for specialty crop producers. Maybe you’re a banker, and your banking policies require that loan applicants have crop insurance.  Center for Rural Affairs will hold free webinars on Whole Farm Revenue Protection (WFRP), a crop insurance option that requires crop diversity in order to qualify. The first two webinars are on Thursday, Nov. 17: one for producers and one for insurance agents. All are welcome to attend, there is no cost to participate.