State of Oklahoma Faces HUGE Budget Shortfall 

The Board of Equalization on Tuesday approved revenues available for Fiscal Year 2016 discretionary appropriations of $6,601,534,037, which is $611.3 million, or 8.5 percent, less than was appropriated for FY 2015, the current fiscal year ending June 30.


Low oil prices and resulting energy sector losses decreased revenues from December, when the board first estimated $298.1 million, or 4.1 percent, less available for FY 2016 appropriations.


"The gap more than doubled," said Secretary of Finance, Administration and Information Technology Preston L. Doerflinger. "We were prepared to climb the hill we faced before and we're prepared to climb the mountain we face now. It will be difficult, but all options are on the table and the state will meet the challenge."


Oklahoma Speaker of the House Jeff Hickman offered reaction to the budget numbers on Tuesday afternoon- "As we begin to analyze the best way to manage this $611.3 million gap, all options are on the table.  The House stands ready to work with the Senate and Gov. Fallin to enact a budget for our state that minimizes the impact of cuts on core government services and reflects the priorities of the majority of Oklahomans.  

"Fortunately, unlike the federal government, our state Constitution requires our budget to balance. While there may be some short-term solutions for this year, we must look at addressing our budget in the long-term, including reforms to expenditures and budget practices that are not sustainable. Until this is done, we will continue to face future budget shortfalls that are 100 percent avoidable."   

To read more about the revenue loss situation, click here.  

Genomics Helps Reduce Risk in Herd Bull Selection 

Faster genetic change---pork and poultry producers have always had an advantage in this area, but the rapid advancement of genomic technology in the last decade helps cattlemen make quicker progress. Angus Genetics Inc. President Dan Moser said many in the cattle industry are using it, indirectly today.


"Folks that are purchasing yearling bulls that have been genomically tested, you know, the risk involved and the potential change in those animal's genetics or at least the characterization of that, the risk is much less," Moser said.


E-P-Ds are always changing as more information is available, but using D-N-A tests help decrease that amount of change.


"And for a trait like calving-ease, for example, a bull with pedigree data and its own record and those sort of things, might have an accuracy of around twenty percent," Moser said. "And that with genomic testing, that might go to forty percent. The difference in that in percent calving-ease genetics might be two or three percent difference. And if we see two or three percent less assisted calvings, that's a lot less labor, a lot calf survival, a lot more passive immunity through colostrum intake, better calf health. You know, I think the little difference there in that one value on that bull and getting the right one purchased, can really pay off for the producer." 

Click here to read more or watch a video feature from the American Angus Association.

The Renewable Fuels Association (RFA) submitted comments on Monday calling on the California Air Resources Board (CARB) to revise its Low Carbon Fuel Standard (LCFS) re-adoption proposal to reflect recent scientific advances and new empirical data regarding the actual impacts of biofuels on global land use patterns.


In comments submitted to CARB Chairwoman Mary Nichols, RFA noted that while steps have been taken to slightly improve the program in the re-adoption proposal, RFA remains "deeply concerned by several aspects of the proposal," noting that CARB's inclusion of a flawed indirect land use (ILUC) change analysis "threatens the long-term durability of the LCFS program."


RFA points to the central role that grain-based ethanol has played in LCFS compliance over the past four years, noting that nearly 60 percent of all LCFS credits were generated by ethanol. Yet, despite the vital importance of grain ethanol to the program, the proposed ILUC penalty assessed against corn ethanol "will make the use of most grain ethanol infeasible for compliance as early as 2016."  

To read more about RFA's view of the ILUC analysis, click here.  

Peel Says U.S. Was At Critical Point with Shrinking National Cowherd

The U.S. saw a significant decline in cattle numbers during the drought of 2010-2012. Many ranchers, especially here in the southern plains, were forced to reduce their herd numbers in recent years due to the severe drought that drastically affected the Southern Great Plains and to a lesser extent the Midwest. This pushed nation cattle herd to the smallest numbers in more than 60 years. Oklahoma State University Extension Livestock Market Economist Dr. Derrell Peel said the numbers had gotten so small the U.S. was at a critical tipping point.


"I think so, I think we were forced to get smaller than we intended to," Peel said. "I think it probably did have some impacts on market share, if you will. Now I am not as worried about that as some folks. I think we will get market share back. Beef is very competitive on a value basis, if not on a price basis. I think we saw that this last year."


In 2014, there were concerns how demand would play out in having record cattle prices. Peel said most of the concerns come from the fact that the industry had been to these levels before.  At the Cattle Industry Convention, I talked with Peel about beef demand in 2014.  To read or have the opportunity to listen to our latest Beef Buzz segment with Peel, click here.    

You can also hear our entire interview that we conducted with Derrell earlier this month at the Cattle Industry Convention- it was one of several Podcasts we posted while in San Antonio.  Click here to take a listen.

Award winning broadcast journalist Jerry Bohnen has spent years learning and understanding how to cover the energy business here in the southern plains-  Click here for Jerry's website where there is a link on the Left Hand Column where you can subscribe to his daily update of top Energy News.  

On a regular basis, Ed Czerwein of the USDA Market News Office in Amarillo, Texas offers a review of the previous week's boxed beef trade. Here is the weekly boxed beef trade for week ending February 14. The daily spot Choice box beef cutout ended the week last Friday at $237.68 which was $1.40 lower. There were 815 loads sold for the week in the daily box beef cutout. It was about 13% of the total volume. 


The comprehensive or weekly average Choice cutout which includes all types of sales including the daily spot cutout was $239.47 which was $5.60 lower. There were 6,102 total loads sold which was 499 loads lower than the previous week. The formula sales were at 3,198 loads which was only 35 loads lower than last week and are 52 percent of the total loads sold.


Exports as reported on the weekly box beef report are predominately muscle cuts dropped quite a bit and they were at 591 loads which was 313 loads lower than the previous week.   Our North American Free Trade Agreement neighbors purchased 166 loads and 425 loads were shipped overseas.

 

This year we continue to increase our imports of fresh beef.  Click here to read or to listen to Ed Czerwein's report.

This N That- CSP Signup Deadline, Big Iron Wednesday and Employees Buy High Plains Journal 

The former Chief of the NRCS, Bruce Knight, has written a editorial piece on the current window of signup for the Conservation Stewardship Program.  Knight says

"The 2015 Conservation Stewardship Program (CSP) will cover up to 7.7 million new acres and provide $100 million to participating farmers.  But you only have until February 27 to sign up to be part of this year's program.  Of course, you can fill out the paperwork at any time, but to be considered for funding this year, you must move quickly.

"CSP is a "payment for performance" program, so the higher the operation's environmental performance, the higher the payment to the landowner.  Farmers and ranchers receive payments for undertaking additional conservation activities and for "improving, maintaining and managing existing conservation activities."  The Natural Resource Conservation Service (NRCS) provides participants with an annual payment and in some cases supplemental payments for adopting resource-conserving crop rotations.

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It's Wednesday- and that means the Big Iron folks will be busy closing out this week's auction items - all 605 items consigned.  Bidding will start at 10 AM central time.                  

Click Here for the complete rundown of what is being sold on this no reserve online sale this week.

If you'd like more information on buying and selling with Big Iron, call District Manager Mike Wolfe at 580-320-2718 and he can give you the full scoop.  You can also reach Mike via email by clicking or tapping here.  

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