Organic commodity farmers will harvest a record number of acres across the U. S. this year, according to the Annual Acreage Report, released by Mercaris, the nation’s largest market data and trading organization for organic and non-GMO markets. U. S. Farmers will harvest over three million acres of land certified for organic field crop production, which is a 7% increase over 2018. This increase is driven in large part by a surge in new certified organic field crop operations across the U. S. The West and High Plains regions saw the largest jump in harvested organic field crop acres this year, even though organic corn and soybean farmers have faced the same challenges to production that conventional farmers have had. Overall total organic acres of pasture, rangeland, and organic crop areas has grown to 8.3 million acres, with over 8,000 U. S. farm operations certified as compliant with the USDA National Organic Program standards in 2019.
Searching for information to include in this report over the past several weeks, I keep getting an image of an Ace Reid cartoon, where a geek in a suit is standing in Jake’s ramshackle farmyard telling him, I’m from the government and I’m here to help. Even though our quote “patriotic” farmers and ranchers have born the brunt of trade disputes around the world. They’ve been assured that they’ll soon benefit from an unprecedented demand for the crops and meat that has filled grain bins, warehouses and cold storage for over a year, while competitors have filled the void left by U.S. farmers. At this stage, with the level of surplus corn and soybeans in storage, it will take a polar vortex, cold snap to hit the corn belt this fall to offer any hope that corn and soybean prices will gain even a modest level of profitability for the next couple years, even with an immediate end to the trade wars. But the government has added to the problem by granting waivers to 31 oil refiners who don’t have to blend ethanol into their fuel, thereby cutting 300 million bushels of corn from this year’s demand. Another example of government lack of support is Dairy Management Inc., a nonprofit that’s tasked with promoting milk, cheese and other dairy products. It’s a federally mandated checkoff program supposedly overseen by the USDA. In 2017, It paid 10 executives a combined $8 million, the same year that 1,600 dairy farms closed across the country.
There is increasing evidence that farmers and ranchers are undergoing financial stress this year. For example, a Federal Reserve Bank of Kansas City survey of 181 banks revealed that 30% of the banks in its service area reported that farm repayments are lower and have they have had repayment problems with their agricultural loan portfolios. Several years of Working Capital and Carryover Debt have increased the need for Debt Restructuring. About 75% of these banks have denied new farm applications, and nearly 18% of the banks reported that they had denied 10% of Operating Loan requests. A Creighton University survey of 200 bankers in ten states revealed that 10% of 2018’s Operating Loans were not repaid and were rolled into 2019’s loans, which is significant because this practice was common before the farm debt crisis of the 1980s began.
About three months ago, farmers and ranchers in the Four Corners region were tallying the benefits and drawback of a wet winter and spring. Wet fields made it tough to plant spring grains and dry beans, and the heavy snow pack kept cattle and sheep off mountain ranges for a few weeks. But by mid-June, the Region was drought free according to the U.S. Drought monitor, with the exception of a small part of San Juan County New Mexico. Southwest Colorado and Southeast Utah were also free of abnormally dry conditions. Fast forward to the end of August, and drought is making a comeback. The whole region is registering abnormally dry on the Drought Monitor Map and Moderate drought has made a comeback along much of far western New Mexico. Even farmers with irrigation water are commenting that they could use some help through a good rainstorm. The long-range National Weather Service forecast for the next three weeks is showing higher than normal temperatures and normal precipitation for this time of year.
The much anticipated USDA August Crop Production report that came out yesterday had a rather dramatic impact on wheat and corn prices, trimming about 20 cents per bushel from September wheat prices, while knocking off a quarter on September corn. Soybeans also lost a dime. Now for the rest of the story. When the July crop production report came out, USDA economists had reported that there was more wheat, corn and soybean acres than what market gurus had reported. Grain company experts had predicted that wet fields, poor growing conditions and export demand would cause prices to climb to $8 per bushel for corn and $12 to $14 for soybeans, which caused a market rally in early July before the July USDA report was published on July 11th. After the report, commodity prices settled into the $4 corn and $8 soybean prices that farmers had watched during May and June. Grain traders cried foul, and called for heads to roll at the USDA because the inaccurate information published by the USDA ruined the rally that started in late June. Well, the August report verified that the July USDA estimates of planted acres and potential yields was about right.
Vesicular Stomatitis, often called VSV, continues to infect horses and other livestock in the Four Corners Region. So far, outbreaks are confirmed in Montezuma and La Plata counties, and San Juan County New Mexico. VSV is a contagious disease that afflicts horses, livestock, wildlife and even humans. It’s caused by a virus thatis rarely life threatening but can have a financial impact on the livestock industry. Because the disease is thought to be spread by insects, VSV usually does not carry on into the late Fall.
Good morning. This is Bob Bragg. Welcome to the August 6th edition of Farm News and Views.
Devaluation of the Chinese yuan sent financial markets lower yesterday, and farm commodity markets were also rattled. Futures market prices for grains and livestock continue to be churned by trade war uncertainty.
Good morning. This is Bob Bragg. Welcome to the July 23rd edition of Farm News and Views.
The increasing level of carbon dioxide in the atmosphere is often blamed for a changing climate around the globe. Many scientists believe that combustion of fossil fuels and the decline of forests are factors in the increase of CO2 levels by 100 parts per million since 1950. But farming practices that have resulted in depleted organic material in crop fields are also sited as a factor for this spike in CO2. Soil scientists have recorded from a 20 to 50% reduction of carbon in soils that have been tilled for decades versus soils that have been undisturbed. Additional carbon is lost when wind and water erosion carry soils particles off of fields. So soil scientists have concluded that carbon sequestration in farm fields and grazing lands can reduce and even reverse the amount of CO2 in the atmosphere. Recently, several companies are ramping up to encourage farmers and ranchers to participate in practices that will result in increasing soil organic matter in their fields, using a marketplace developed around CO2 mitigation that enables CO2-emitting industries to purchase carbon credits from businesses engaged in offsetting activities. For example, Boston-based Indigo Agriculture recently unveiled its latest project, the Terraton Initiative, which intends to sequester 1 trillion tons of carbon dioxide from the atmosphere by providing momentary incentives to farmers and ranchers who adopt regenerative agriculture practices. The company contends that if farmers increase the level of carbon in their soils by an average of 0.5% globally, it could reverse the 1-trillion-ton increase in atmospheric carbon since the Industrial Revolution. Some of the practices that Indigo encourages farmers to adopt include no-till crop production, crop rotation, reducing reliance on chemical and synthetic fertilizers and pesticides, and incorporating livestock. The Western Sustainability Exchange is another organization that’s attempting to enroll Montana ranchers in a program that will pay them to use a carefully managed, rotational grazing program that will qualify for the carbon credit market. Rotational grazing calls for moving livestock based on utilization of forage over a short period of time by intensive grazing, then moving the herd to a new section of range or pasture that has not been grazed until it has full recovered from previous grazing passes.
Good morning. This is Bob Bragg with the July 16th edition of Farm News & Views.
Farmers in the mid section of our country continue to be affected by too much water this growing season. Although soils have started to dry out in some fields in the Corn Belt they may soon be getting a lot wetter, since Tropical Depression Barry is following the Mississippi River Valley northward, dropping precipitation on fields that have received way too much rain already. Before it dies out, it’s likely to have affected 12 states, dumping from one to more than three inches of rainfall over the next couple of days according to the National Weather Service. But then, as the storms passes, the areas in Barry’s wake are expected to suffer from a “widespread” heat wave starting later this week.
Good morning. Welcome to the July 9th edition of Farm News and Views.
You may have noticed bees being…Well, busy as bees this spring and early summer tending to flowers in gardens, on fruit trees and even on weeds. Bees help to pollinate a third of the crops we eat, including almonds, apples, avocados and grapes, but bee populations have steadily declined since 2006. However, the U.S. Department of Agriculture’s National Agricultural Statistics Service (NASS) won’t collect quarterly data this July for the annual Honey Bee Colonies report, citing budget constraints. This report has allowed the USDA, beekeepers, and other interested parties to compare quarterly losses, additions, and movements and to analyze the data on a state-by-state basis.