~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~Oklahoma's latest farm and ranch news
Your Update from Ron Hays of RON for Monday January 7, 2008!A service of American Farmers & Ranchers Mutual Insurance, KIS Futures & Midwest Farm Shows
-- A look into 2008 with Mike Spradling.
-- Advancing Wheat Through Innovation and Advocacy!
-- Beef Demand Worries Center Around Competing Meats and a Sagging US Economy.
-- More Optimistic About Cattle Prices in 2008- Jim Gill of TCFA
-- $383 Million Dropped into Rural Oklahoma this past year by USDA's Rural Development Agency.
-- Stand and Deliver- FFA Speech Workshops Coming Up
Here's your morning farm news headlines from the Director of Farm Programming for the Radio Oklahoma Network, Ron Hays. We are proud to welcome KIS Futures as a regular sponsor of our daily E-Mail. KIS Futures provides Oklahoma Farmers & Ranchers with futures & options hedging services in the livestock and grain markets- Click here for their website or call them at 1-800-256-2555.
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A look into 2008 with Mike Spradling.
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~The new President of the Oklahoma Farm Bureau is Mike Spradling, who is a pecan farmer and cattle rancher from Tulsa County. As you may remember, he was elected this past November- and is getting comfortable with the many duties that his new job demands.
One of those duties is leading the Oklahoma Farm Bureau delegation to New Orleans this coming weekend for the 2008 American Farm Bureau Convention. He expects ninety some odd folks will be making that journey in just a few days. He tells us there are some five resolutions that are likely to be adopted at the national level that have bubbled up from the Oklahoma Farm Bureau annual meeting of this past November. They include the drive to get AFBF behind raising weight limits for farm trucks across state lines, encouraging agribility programs to be expanded as well as a desire to see some labeling of what dried distillers grains really consist of- in order to allow livestock producers interested in using this expanding feedstuff not to get burned by substandard product.
We also visited with Mike about the priorities of OFB at the state level as well- plus some of his organizational goals as he heads up the general farm group. You can hear our full conversation with Mike- we have it linked on our Featured Audio page of our website- www.OklahomaFarmReport.Com- as well as being linked for you below. Take a listen!
Advancing Wheat Through Innovation and Advocacy!
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~The National Association of Wheat Growers held a strategic planning session over this past weekend- and a pair of Oklahoma wheat officials were involved. Oklahoma Wheat Grower Executive Director Tim Bartram and OWGA Past President Jeff Krehbiel of Hydro were in Dallas for the sessions- Jeff sits on the NAWG Strategic Planning Committee- and Jeff says that the NAWG has come up with a new Vision Statement to start 2008 with- "Advancing Wheat Through Innovation and Advocacy."
A couple of issues that were identified as areas that NAWG will need to take a leading role in over the next few years included biotech in wheat and transportation issues. The first issue mentioned, biotech in wheat, is a big worry since we have stacked traits starting to become common among other crops that will help farmers grow more and better quality of those grains, oilseeds or fibers. But wheat is still sitting at the starting gate when it comes to biotech, with both domestic and international buyers resisting any move to allow wheat producers take advantage of this technology explosion in crop agriculture.
Jeff tells us that these weekend session identified several major issues- and now these issues will go back to relevant committees of the organization and the hope is to come up with ways to best attack each of these "big picture" items in the weeks and months ahead. We have an audio summary of our conversation with Jeff after he got back to Oklahoma last night- it's linked below and on the front page of our website.
Beef Demand Worries Center Around Competing Meats and a Sagging US Economy.
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~OSU's Extension Livestock Economist Dr. Derrell Peel writes this past Friday that we have our share of worries as we begin the new year when it comes to profitability in the beef business. Dr. Peel tells us "Through most of 2007 strong beef supply fundamentals kept bumping into a demand ceiling that resulted in a crushing squeeze on feedlot and packer margins. Current indications are that demand concerns will increase in 2008 and industry margins may worsen or, at best, fail to improve. Poor macroeconomic news continues to weigh on beef demand with accumulating indications of general weakness in the U.S. economy. It is not so much that any one indicator represents a definite problem but rather the expanding set of indications in various sectors of the economy that suggest looming dark clouds. Many economists agree that the threat of a recession is higher and growing.
"Beef demand is also a function of the availability and price of competing meats. The December Hog and Pig report confirmed that the pork industry in the U.S. continues to expand, following rapid increases in pork production in the last half of 2007. Broiler production is expected to increase in 2008 as well. Increased pork and poultry production will keep competing meat prices down and temper beef prices as well. There are indications that consumers have responded, not so much by eating less beef, but by "trading down" , that is, buying less expensive beef cuts and by reducing away from home consumption. Several restaurants reported weak sales in late 2007 and a recent survey by the National Restaurant Association indicates that only 16 percent of restaurant operators expect business conditions to improve in the first half of 2008 while 41 percent expect conditions to worsen.
"Economists define demand for a product as the willingness and ability
of consumers to purchase different quantities of the product at various
prices. At the current high prices, there is already a limit on the
quantity of beef that people will purchase. Beyond that, there are
significant and probably growing factors that will further limit both the
ability and willingness of consumers to buy beef. High fuel prices and
rising unemployment reduce discretionary incomes and the ability of
consumers to purchase beef. Willingness to purchase is influenced by
several factors. Overall, beef is still popular and there is no indication
that people do not want to eat beef. However, increasing supplies of
cheaper alternative meats means that consumers will be more willing to
substitute other meats for beef. In 2007, beef demand was probably best
characterized as a ceiling that limited beef and cattle price increases.
As we begin 2008, increasingly ominous beef demand factors could cause the
ceiling to begin dropping, thereby making industry margins even worse and
impacting cattle prices to a greater extent."
More Optimistic About Cattle Prices in 2008- Jim Gill of TCFA
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~Longtime Market Director of the Texas Cattle Feeders Association seems to be more optimistic about where cattle prices may go this year as compared to Derrell Peel's comments we offered above. He anticipates cattle feeders maintaining prices in the high $90s with plateaus above $100per hundredweight. Gill says in the weekly TCFA Newsletter "Competition for fed cattle among packers will increase in 2008, and packers will have to pay more for the cattle they want. In addition, the weak dollar will make beef exports more attractive to other countries. It will be awhile before we get exports back to pre-2003 levels, but I expect a continued increase this year."
Of course, there are several negatives to watch for in 2008, Gill said. He does not foresee any relief on prices for cattle feeders' two primary inputs: corn and feeder cattle. The farm level corn price for the Corn Belt area during September, October and November for 2007 was $3.36, according to USDA. "I would expect the price for the 2007-08 year to be near $3.80 and for the 2008-09 year to be closer to $4.25." Gill said. As for feeder cattle, Gill said, "We are dollars below the record Feeder Cattle Index of $120.10 set on September 9, 2006, but we are at a level now (around $103.00) that looks attractive to anyone wanting to buy feeder cattle. Higher corn prices and losses in the feeding industry have pressured feeder cattle to present levels, but tight supplies of feeder cattle are likely close to putting a floor under their prices." Gill expects feeder cattle supplies to remain flat, largely due to dry weather and higher corn prices.
Here's what Jim Gill sees for the slaughter cattle prices quarter by
quarter in 2008:
$383 Million Dropped into Rural Oklahoma this past year by USDA's Rural Development Agency.
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~A total of $383,292,019 was invested into rural Oklahoma from the USDA's Rural Development Agency in Fiscal Year 2007. Details of how these monies were invested into rural Oklahoma are detailed in the just released annual report of Fiscal Year 2007 Oklahoma Outlook- the USDA Rural Development Annual Report.
Housing, Rural Electric, Water, Broadband Internet and Housing were some of the categories of how these monies were spent in this past fiscal year. Undersecretary for Rural Development Tom Dorr says in this report "In our present form, we are essentially an investment bank for rural America with a portfolio of more than $97 billion. This is invested in rural infrastructure, housing, community facilities, business, and energy development. We are, in fact, the only agency in the federal government that can build an entire community from the ground up."
State Director Brent Kisling adds "Our job is to provide the capital
that community leaders need to make their vision a reality. Our centennial
year of 2007 was a great year and we expect 2008 to be even better!"
Stand and Deliver- FFA Speech Workshops Coming Up
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~Rhett Laubach and Kelly Barnes will be holding a series of FFA Speech Workshops across Oklahoma the next few weeks as their 2008 Stand and Deliver training is just around the corner.
There will be five conferences this year, one per district. The conferences are designed to help students with handling nervousness, picking a topic, answering questions, how to memorize any speech and much more!
There will be a total of five workshops- one in each of the five state
FFA districts. Those conference locations include:
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