Crop Insurance Next in the Crosshairs, According to Art Barnaby

With direct farm payments set to disappear from farm policy, the next item in the crosshairs of those in Congress appears to be crop insurance programs, says Dr. Art Barnaby, professor of agricultural economics at Kansas State University. He was part of a panel discussing Issues in risk management at the recent Ag Issues Summit in Oklahoma City.

"That appears to be the case for people who want no farm program, no safety net at all. I think this is the last pot of money to go after. The pot of money is relatively small. Over the last 12 years the average taxpayer cost has been a little over $4 billion and throw in another billion or so for the delivery system, so we're talking a little over $5 billion a year. In Washington terms, those aren't big numbers."

Barnaby says that those who are attacking the crop insurance program are using incorrect numbers to make the cost of the program seem far larger than it actually is.

"Early on in the 2012 year when the drought was on the way in the Corn Belt there were a number of sources floating around saying it was going to cost the taxpayers $40 billion. That was an impossible number from the get go and people should have known better. But it got reported in the press and, after awhile, nobody ever challenges the number. Then, later, when it became clear it wasn't going to be that much, then the story in the press was that it was going to cost taxpayers over $17 billion. Well, when you net out all the numbers, it's closer to $12 billion and then you put into perspective that's one time in 20 years. That's not every year. In fact, you have years in the other direction where premiums exceed claims and the government costs are very small in those years."

Barnaby says there have been calls for limits on premium subsidies for large operations and implementing such a program would be problematic.

You can listen to my full conversation with Art Barnaby by clicking here.

Beef Cow Slaughter Falls to Levels Under One Year Ago- Jim Robb of the LMIC 

According to Jim Robb with the Livestock Market Information Center, U.S. beef cow slaughter has recorded large year-on-year declines during recent weeks, a trend that is expected to continue. Even with forecast year-on-year declines during the balance of this year, U.S. Federally Inspected beef cow slaughter this year will be below 2012's (down 125,000 to 200,000 head). However, given the percentage of the January 1st beef cow inventory as reported by USDA-NASS that will be slaughtered this year, there is only a small probability of the number of U.S. beef cows growing year-on-year as of January 1, 2014. 

In the second quarter of this year (April through June), U.S. beef cow slaughter was up 88,000 head or 12% compared to a year ago, which was surprising large given the drought-forced herd liquidations that occurred in 2012. As the summer quarter progressed this year, national pasture and range conditions recorded significant year-on-year improvement and beef cow slaughter levels have dropped from 2012's levels.
       
Most U.S. plants are Federally Inspected (FI), those plants are required to report weekly slaughter data, which is collected by USDA-FSIS and then complied, checked, summarized, etc., by USDA-NASS. In late June (week ending June 29th), FI beef cow slaughter was 3% below the same week in 2012. That was only the second year-on-year drop in the prior 16 weeks. Since late June, beef cow slaughter has been below a year ago. Importantly, year-on-year declines have become much more pronounced during recent weeks.

Jim Robb joins me on the latest Beef Buzz.  Click here to listen in. 

Crop Insurance Changes Imperil Oklahoma Producers' Winter Wheat Options  

In a good year in Oklahoma as well as in parts of Kansas and Texas, many wheat producers are able to get a dual harvest. They can harvest forage in the form of wheat pasture for calves during the winter and either hay their wheat the following spring or harvest it for grain.  

Terry Detrick, president of American Farmers and Ranchers, says that this system could soon come to a screeching halt. He spoke recently with Ron Hays and says Oklahoma has been notified it is part of a six-state area targeted for changes in crop insurance. He says that under the new program to be put in place after the 2014 crop year, producers will no longer be able to get insurance through the FSA that will protect them for dual crops.

The insurance which will be available will solely be based on rainfall. Detrick says the new program is deeply flawed.

"Originally, the intent of Congress from the beginning on crop insurance including the NAP programs was to have multi-peril-type coverage. And this takes all coverages away except dealing with rainfall."

You can read more of this story or listen to my interview with Terry Detrick by clicking here.

Alva 4-H Claims Top Honors at State Fair of Oklahoma Livestock Judging Contest- Idabel Tops FFA Division  

The Livestock Judging Team that represented Alva 4-H was the high scoring team at the 2013 State Fair of Oklahoma Livestock Judging Contest- winning the Senior 4-H Division in the competition that Oklahoma Farm Bureau YF&R Committee hosted. This contest was open to FFA and 4-H students across the state- and here in 2013, close to eight hundred youth participated.


The Alva 4-H team bested the high scoring Senior FFA team from Idabel by 11 points.

The Junior FFA Division was won by Kingfisher2, while the Junior 4-H high honors at the team level were claimed by the team from Amber Pocasset.


High Individual for the day was Kory Dietz from the Alva 4-H Club, while Samantha Graves had the high individual score in the FFA division, three points behind Dietz. Dietz led all scorers with a 462 tally, while Graves had 459.

We have the listings of the top teams and individuals on our website- and we have pictures of the top teams and some of the top individuals- plus a quick audio conversation with Mason Bolay of the YF&R on why they host the event- click here to check out the listings, the pictures and that interview.

USDA Announces Support for Producers of Advanced Biofuel

Agriculture Secretary Tom Vilsack announced that the U.S. Department of Agriculture (USDA) is making payments to support the production of advanced biofuel. USDA is making nearly $15.5 million in payments to 188 producers through the Advanced Biofuel Payment Program. USDA Rural Development Acting Under Secretary Doug O'Brien made the announcement on Vilsack's behalf in Omaha, Neb., at the National Advanced Biofuels Conference. USDA remains focused on carrying out its mission, despite a time of significant budget uncertainty. Today's announcement is one part of the Department's efforts to strengthen the rural economy.

 "Producing advanced biofuels is a major component of the drive to take control of America's energy future by developing domestic, renewable energy sources," O'Brien said. "These payments represent the Obama Administration's commitment to support an 'all-of-the-above' energy strategy."

The funding is being provided through USDA's Advanced Biofuel Payment Program, which was established in the 2008 Farm Bill. Under this program, payments are made to eligible producers based on the amount of advanced biofuels produced from renewable biomass, other than corn kernel starch. Examples of eligible feedstocks include but are not limited to: crop residue; animal, food and yard waste; vegetable oil; and animal fat. 

You can read more or this story by clicking here.

USDA and Coca-Cola Partner to Replenish One Billion Liters of Water to Nature

U.S. Department of Agriculture (USDA) Secretary Tom Vilsack and Coca-Cola Americas President Steve Cahillane announced a public-private partnership to restore and protect damaged watersheds on national lands. Together these efforts aim to return more than a billion liters of water to the National Forest System - which provides drinking water to more than 60 million Americans. The announcement was made at Midewin Tallgrass Prairie in Illinois.

"By working together, we can better protect our nation's watersheds and further enhance restoration efforts, even during challenging budget times," said Secretary Vilsack. "Today's partnership between Federal, private and non-profit partners is just one example of the strong collaboration that allows government to continue providing results for the American people.

The new collaboration between government, business and community organizations, including the National Forest Foundation (NFF) and National Fish and Wildlife Foundation (NFWF), which have also contributed funding for these projects, will leverage collective expertise to address increasing challenges on water resources. Additionally, federal dollars spent on these projects have been matched two-to-one by Coca-Cola, the National Fish and Wildlife Foundation, and the National Forest Foundation.

Click here for more.

This N That- Rainfall Arrives- Planting Won't Be Far Behind, Peel on Herd Expansion and Heart of America Farm Show 

Rainfall totals are not uniform across the state since this past Friday morning- but many locations have received enough rain to have farmers in those locales ready to run the grain drills for planting of winter wheat and/or winter canola once the fields dry out enough to handle the farm equipment.

And the forecast shows more rain in the mix- even for southwestern Oklahoma, which has gotten almost nothing to this point since the high pressure ridge has begun to break down and allow these systems to get into the state.

We have the latest weather maps for you to check out- click here to take a look!

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In a roomful of cattle feeders, an Oklahoma State University (OSU) livestock marketing specialist had everyone's full attention as he said there is no way around it: In the next two to three years, the already short supply of feeder cattle will only get tighter. 

OSU Breedlove Professor Derrell Peel described the current feeder cattle situation and the circumstances leading to it at the eighth annual Feeding Quality Forum in Omaha, Neb., and Garden City, Kan., last month.

 With a U.S. cattle inventory at levels not seen since 1952, "We're much smaller than we ever intended to be," Peel said. Drought and other circumstances led producers to liquidate their cow herds 15 out of the last 17 years, despite recent market signals to expand.  Peel expects that to change.   

You can read more from Derrell Peel by clicking here.  

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I just wanted to give you a quick reminder of the first ever Heart of America Farm Show that is coming this next weekend- Friday through Sunday, September 20-22.  

For more details- click here for their website- we will be doing a couple of seminars at the Show on both Friday and Saturday- and have invited Gant Mourer of OSU to join us for our sessions.