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Report outlines forces shaping the rural economy

Written by TF Staff on .

Expect an expanding global economy, strong U.S. consumer confidence and persistent economic recovery in many rural areas, but temper that optimism with another year of on-farm belt tightening due to low commodity prices.

That’s the 2018 outlook from a wide-ranging report compiled by CoBank, a $124-billion cooperative bank serving rural America.

“The rural economy is uniquely impacted by what happens in Washington, the broader U.S. economy and around the world,” said Dan Kowalski, vice president of CoBank’s Knowledge Exchange Division. “This year, rural America will rise with the broader economic tide, but it will also contend with persistent barriers to prosperity.”

The report offers a look at these 10 key factors that will shape rural communities and the market sectors that support them:

  1. Global economy — The challenge for the world’s economies will be how to properly manage the expansion at hand and address structural impediments that have been ignored during the decade-long recovery.
  2. Monetary policy — Central banks around the world will strategize around the question of whether wage and consumer prices will accelerate. Foreign banks sound more hawkish in early 2018, and the Federal Reserve will continue to raise interest rates amidst larger fiscal deficits and leadership transition.
  3. U.S. economy — Consumer confidence and unemployment rates are at their best levels since 2000, and inflation-adjusted wages have been growing faster than historical averages since 2014. Consumers are saving less and spending more. Business investment will rise in 2018 to keep up with growing demand.
  4. Rural economy — Rural America has lagged urban areas in recovering from the 2008 economic crisis, but rural population, jobs and incomes are all trending in the right direction. Current efforts to improve rural broadband access offers an opportunity to make a significant dent in the rural/urban economic divide.
  5. Federal policy — Tax reform has brought changes to individual and corporate tax rates and ushered in the 199A deduction, which benefits agriculture co-ops and their members. The deduction, however, is controversial and is being reviewed by the Senate. Congress will also attempt to pass an infrastructure package and the Farm Bill before the mid-term election.  
  6. Rural infrastructure — The power and energy industry faces an environment of uncertainty due to tax reform, possible import tariffs on wind and solar equipment and oversupply in power markets. Meanwhile, weak sales and rising costs are contributing to financial strain across water utilities. And in communications, competition is heating up over who controls the infrastructure that distributes data through broadband. Rural communities can expect further investment in broadband and towers in 2018.
  7. Agricultural economy — The agricultural commodity surplus will continue to depress prices and shrink farmer working capital. Farm debt loads will continue to climb as prices fall short of high production costs. Market conditions have also resulted in a sharp divergence between farm income and farm asset values. The timing and extent of the market’s correction will be determined by much more than commodity prices and cash flow.
  8. Agricultural trade — NAFTA will be the primary focus for agriculture in the first half of 2018. All three countries involved will be incentivized to come to an agreement before the Mexican presidential election in July. Other trade deals in flux that could greatly affect U.S. agriculture exports include the rebooted Trans-Pacific Partnership and the U.S.-Korea trade agreement.
  9. Grain, farm supply and biofuels — The grain, farm supply and biofuels sectors face a turbulent year ahead as the industry further adjusts to a protracted cyclical downturn. Abundant supplies, low market volatility and rising interest rates will constrain farm finances and accelerate the forces of consolidation.
  10. Dairy and animal protein — The same abundant grain supplies that have harmed crop farmers have boosted profitability and spurred expansion in the U.S. livestock sectors. And more good news is expected in 2018. Price pressure will be an issue as the expansion continues, and trade uncertainties will loom large.

The full report is available at www.CoBank.com

Engaging in the conservation conversation

Written by Kerri Lotven on .

Conservation is at the forefront of many agricultural conversations from the dinner table to D.C., and now farmers and ranchers have a new resource at MFA to help lead those discussions.

On Dec. 1, Matt Hill began his new job as MFA Incorporated’s first-ever natural resources conservation specialist—a position established through a partnership among MFA, the Missouri Department of Conservation and USDA Natural Resources Conservation Service.

“Conservation is very important to our producers, therefore it’s important to MFA,” Jason Weirich, MFA director of agronomy, said. “The ultimate goal by establishing this position is to increase conservation and look at ways to have a greater impact on stewardship. Matt will be working with our partnering organizations and growers to find programs and cost-share money that helps with soil, water, nutrient and wildlife management.”

Through this partnership, Hill will provide MDC and NRCS feedback on their programs and how they work for producers. This one-of-a-kind role suits Hill perfectly, who spent the last 14 years managing 45,000 acres of public land for MDC.

“There are a lot of programs available through MDC and NRCS that offer financial assistance,” Hill said. “Most farmers and ranchers are already doing things voluntarily because they know it’s the right thing to do for the environment and for the sustainability of their operation. But there may be money available to help offset some of the costs. I just hope to shed some light on some of those opportunities.”

According to Brent Vandeloecht, MDC agriculture liaison, this position and partnership is a first in Missouri.

“As far as I know, this position marks the first time the state and federal agencies have partnered with private enterprise,” Vandeloecht said. “MFA is a natural choice because it is a leader and trusted entity by many row-crop and cattle producers across Missouri. The hope is that MFA, the agencies and the producers can all benefit by increased communications and learning more about balancing conservation and profitability.”

Missouri State Conservationist J.R. Flores agreed that this partnership will increase the availability of technical knowledge and assistance for Missouri farmers and ranchers.  

“No better place exists for conservation opportunities than in Missouri,” Flores said. “This position is exciting because we’ll be increasing the awareness of those opportunities and, more importantly, how conservation practices can translate to benefits in natural resources, such as soil, water, plants and animals.”

A native of Bowling Green, Mo., Hill said he spent summers on his family’s farm, both working and enjoying outdoor pastimes such as hunting and fishing. He is a 2003 graduate of the University of Missouri at Columbia, where he specialized in fisheries and wildlife management. Soon after, he landed a position in the wildlife division of MDC.

“Some public land management areas in the state still have a high percentage of native tallgrass prairies,” Hill said. “A large part of our work focused on managing these special conservation areas that contain populations of prairie insects and grassland birds that are declining worldwide. There are a lot of landowners who are conservation-minded and have a real interest in managing their property in such a way for it to still remain productive and profitable but also provide wildlife habitat.”

Likewise, Weirich said, when looking at a cost-per-acre breakdown, implementing conservation practices and taking advantage of cost-share initiatives make sense on low-yielding or otherwise unusable acreage.

“In the near future, we’ll be looking at a cost analysis on a per-acre basis,” he said. “If there are areas of a field that are continually losing money, then we should consider programs or practices that can help producers maximize profitability while implementing common-sense conservation.”

Hill and his wife, Lori, have two sons, Carson, 8, and Blake, 5.

Today’s Farmer readers will hear more from Hill in regular columns and articles covering conservation topics. If you have questions about conservation practices or potential cost-share benefits, contact him at This email address is being protected from spambots. You need JavaScript enabled to view it..

The show goes on

Written by TF Staff on .

Farmers and ranchers throughout the Midwest can see the latest agricultural products and technologies to help boost productivity when the 2018 Western Farm Show returns to the American Royal Complex in Kansas City, Mo., Friday through Sunday, Feb. 23-25.

Now in its 57th season, the Western Farm Show features one of the region’s largest indoor displays of farm and ranch products. More than 500 exhibitors, including MFA Incorporated, will feature farm equipment, crop production and livestock products, farm structures, numerous ag services and much more.

Other highlights include:

  • The Stockmanship and Stewardship Low-Stress Livestock Handling Demonstration, sponsored by MFA Incorporated, will be held at 10:30 a.m. and 2 p.m. on Saturday, Feb. 24, in the Scott Pavilion adjacent to the American Royal Complex. The demonstrations are included in the show admission price and focus on improving the well-being of beef and dairy cattle, as well as their handlers, through humane animal care.
  • The Health & Safety Roundup, coordinated by Missouri Farm Bureau, features blood pressure, hearing and skin cancer screenings at no cost and cholesterol screenings for a nominal fee. Also offered will be free children’s vision tests. Highway safety will be presented by the Missouri and Kansas Highway Patrols, while other organizations will offer displays and demonstrations covering such topics as gun safety, crime prevention and FAA security/hazardous materials.
  • A cooking demonstration by the Culinary Center of Kansas City will be Saturday 11 a.m. and 1 p.m., sponsored by American Family Insurance. Tickets to the cooking shows are free, available in advance from American Family Insurance agents and at the company’s booth while supplies last. 
  • During FFA Day on Friday, Feb. 23, an expected 3,000 FFA students from Missouri and Kansas will compete for bragging rights in the annual Food Drive “Border War.” Collections are donated to the Harvesters Community Food Network serving western Missouri and eastern Kansas. FFA youth also have the opportunity at the show to expand their knowledge about agriculture and learn about career options.
  • The Family Living Center, a special area of the show, will feature clothing, crafts, and food, health and home décor items.
  • Sunday, Feb. 25, will be Military Appreciation Day, providing free show admission for veterans and active-duty service personnel with appropriate identification.

Show hours are 9 a.m. to 5 p.m. Friday and Saturday and 9 a.m. to 4 p.m. on Sunday. Adult admission is $8 and free for children 12 and under. For more information visit WesternFarmShow.com or follow on Facebook and Twitter.

Forage and grazing conferences merge

Written by TF Staff on .

The annual Southwest Missouri Spring Forage Conference and the Heart of America Grazing Conference are coming together for a combined two-day event on Monday, Feb. 26, and Tuesday, Feb. 27, at the University Plaza Hotel in Springfield, Mo.

The joint conference is designed for producers interested in learning more about management strategies for forages and livestock. Monday afternoon’s agenda offers four different sessions focusing on soil health on grasslands, followed by a social event, trade show and evening dinner.

On Tuesday, 45-minute breakout sessions will feature topics that include chemical weed control in pastures, understanding forage quality, grazing alfalfa, mineral supplements in pastures, incorporating sheep and goats into the cattle operation, beef genetics, getting top dollar for your calves, adapting to the forage growth curve and conditioning cows for pregnancy. The keynote luncheon speaker is Dave Pratt, who teaches the Ranching for Profit School in North America, Australia and Africa. He’s been instrumental in developing the Sustainable Ranching Research and Education Project and is co-founder of the California Grazing Academy.

More information and registration are available at SpringForageConference.com or by calling 417-532-6305, ext. 101. Pre-register by Feb. 16.

Feeding the economy

Written by TF Staff on .

The food and agriculture industries not only play a vital role in feeding Americans but also in feeding and growing the nation’s economy.

That fact was put into figures through a nationwide economic impact study released in November. The research found that more than one-fifth (or 20.4 percent) of the nation’s economy is linked, directly or indirectly, to the food and agriculture sectors, and more than one-fourth of all American jobs (28 percent) are similarly connected.

The extensive farm-to-fork economic analysis quantified the impact of the jobs, wages, taxes and exports the agricultural and food industries make possible. Twenty-two food and agriculture organizations commissioned this research. Among the most important findings were:   

  • Total jobs: 43,311,057
  • Total wages: $1.9 trillion
  • Total taxes: $894.13 billion
  • Exports: $146.32 billion
  • Total food and industry economic impact: $6.7 trillion

To measure the total economic impact of the sectors, the analysis also includes the indirect and induced economic activity surrounding these industries, which captures upstream and downstream activity. For example, when a farm equipment retailer hires new employees because farmers are buying more tractors, experts consider the new salaries an indirect impact. Similarly, when that new retail associate spends her paycheck, an induced economic impact occurs. Together, these have a multiplier effect on the already formidable direct impact of food and agriculture.

“These numbers tell an essential story, reminding us that food and agriculture remain absolutely central to our nation’s well-being. We not only produce three square meals a day for most Americans, that same work supports one in four American jobs,” said John Bode, president and CEO of the Corn Refiners Association, one of the commissioning groups. “Policymakers should keep this data in mind as they consider changes to tax and trade issues that might affect the food and agriculture sectors.”

The complete report is online at FeedingTheEconomy.com.

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