Digging Deeper... The Loss of a Giant

Earlier this month, agriculture – locally, nationally and globally – lost a giant when Dr. Barry Flinchbaugh passed away.  For more than half a century the Kansas State University agricultural economist influenced the formation of U.S. farm policy. In 2014, Dr. Flinchbaugh received the Agricultural Business Council’s Jay B. Dillingham Award for Agricultural Leadership and Excellence. He worked on every Farm Bill since 1976, and it has been noted he met every American president since Harry Truman. In this edition of Digging Deeper, we are featuring tributes to Dr. Flinchbaugh from Sara Wyant, founder of Agri-Pulse Communications and its chief editor, and U.S. Senator Jerry Moran, who said, “There may be no Kansan whose company I enjoyed more.” But before getting to their remembrances, it might be nice and surely fun to recall the directness, wit and insight Dr. Flinchbaugh provided whenever he spoke. So here, then, is a Sampler of Flinchbaughian Rhetoric (excerpted from his keynote speech to a Kansas Commodity Classic audience in January 2018). Dennis McLaughlin, McLaughlin Writers LLC

• “We’ve got a solid Kansas delegation with Sen. Moran and Sen. Roberts, and with Dr. Marshall we have a member on the House Ag Committee again….. If the other 49 states had the kind of delegation Kansas does, there’d be a lot fewer problems. But unfortunately, they don’t.”

• “There is a big lesson that needs to be learned or re-learned [regarding trade]. This is a global economy and we aren’t going back. In 1960, about 9% of our GDP came from trade. In 2016, it was 24%.

• “We’ve been through the nonsense of having congressmen fall for the idea of separating the two [regarding food stamps]…..If you take food stamps out of the bill, then that’s the last Farm Bill you’ll see. Urban congressmen don’t have any reason to support crop insurance without a nutrition program. The two have got to stay together.”

• “You’ve got people  saying if food stamp recipients need to be drug-tested, then so do farmers getting subsidies for crop insurance……It’s a no-win position.”

• “TPP was probably the most lucrative bill for farmers in my lifetime. It put the U.S. in a strong, countervailing position of power to China. It put two powers in the region instead of one bully. Rejecting it played right into China’s hands. We have to get across the point that multi-lateral agreements are far superior to bi-lateral agreements for farmers.”

• “At the end of the day, the question is, if you don’t have exports, you need to cut ag by 25%. Which 25% do you want to put out of business?”

• “You get all this talk about H2A workers, but we don’t need seasonal workers. Cows have to be milked 365 days a year. We need permanent workers.”

• “The reality of the last several years has been that net migration is going south, wages are going up and labor shortages are becoming common.”

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An Economist Who Influenced Decades of U.S. Farm Policy,

And Thousands of Students and Farm Leaders

Sara Wyant, Founder and Editor-in-Chief, Agri-Pulse Communications

There are a lot of different and talented agricultural economists in this country. But Dr. Flinchbaugh was unique in his style, his colorful stories and his convictions. If you ever met him, you wouldn’t forget him.

As a professor and extension educator, Flinchbaugh taught agricultural policy subjects to approximately 4,000 undergraduates and, as a much sought-after speaker, lectured at farm meetings around the country. Most recently, he served as professor emeritus, department of agricultural economics, at Kansas State University, where he joined the faculty in 1971.

"He was always able to look at complex numbers and develop a narrative around those numbers that helped everyone understand the policy and the implications — whether it was the farmer, the elected official or the person in the White House," noted Mike Torrey, principal and founder of Michael Torrey Associates and a former student in Dr. Flinchbaugh's farm policy class.

Kansas farmer Jay Armstrong was Dr. Flinchbaugh’s second teaching assistant in 1972-74. “I drove him around to every county in Kansas when he educated farmers on how use-value appraisal would work. It was complicated, but Barry’s style made it so farmers could understand it,” Armstrong recalled. “From that effort, ag organizations took hold of their now educated membership and got urban candidates to support a change to the Kansas constitution which has saved farmers untold millions.  

“His plain speaking style is what made him a necessary force in Kansas ag policy and in turn his talents were used nationally with Freedom to Farm. Outspoken? Certainly. Effective? Definitely, yes.”

Students flocked to Dr. Flinchbaugh’s classes and many remember his style as tough but rewarding. He frequently chewed on a cigar and in later years, took pleasure in stomping his cane at his side to make a point.

“The truth was that Barry’s ‘bark was worse than his bite’. He would challenge and sometimes even scare students. But once they became amiable to working and understanding, he would bend over backwards for them - not only in their studies but helping them with their lives and finances. In short, his heart was bigger than his bravado,” Armstrong added. “He told me many times, ‘put humor into teaching and students will remember….that’s the goal.’”

During his early professional years, he began working with leaders of both political parties on federal farm bills. On a national level, his contributions to the development of U.S. agricultural policy have included serving as chairman of the Commission on 21st Century Production Agriculture formed by the 1996 FAIR Act (also known as the Freedom to Farm Act).

Dana Brooks, the CEO of the Pet Food Institute, said she first met Dr. Flinchbaugh when he chaired the 21st Century Ag Commission in 2000. She was a new staffer on Capitol Hill. “I was mesmerized by his intelligence, personality, leadership and commitment to agriculture. When I started looking at graduate school programs, I picked Kansas State University because of its reputation and Dr. Flinchbaugh was an advisor to the program. He will always be larger than life in my memories.”

Some of Dr. Flinchbaugh’s speeches and comments created controversy. Gregg Doud, who is now the top agricultural adviser for the U.S. Trade Representative, remembers walking across the Kansas State campus during his freshman year when the American Agriculture Movement hung a Flinchbaugh look-alike in effigy. They were upset about comments Flinchbaugh had made about whether or not there were too many farmers in 1985. “I remember thinking, ‘who is this guy?’” Doud recalled. “He taught me never to back down.”

Many government leaders shared their memories of the impact he had on policy, as well as on them personally. Said Kansas U.S. Senator Pat Roberts, chairman of the Senate Agriculture Committee: “Franki [wife] and I are deeply saddened by the news of Dr. Barry Flinchbaugh’s passing earlier today. Dr. Flinchbaugh was nothing short of a legend in his field. His expertise made him one of the most coveted and trusted advisors for agricultural policy for decades.

"Dr. Flinchbaugh’s legacy as an educator and advocate will live on through his work at Kansas State University and his lifetime of dedication to agriculture. I will not only miss his guidance, but I will also miss his friendship, wit and humor. I have many special memories of Barry, in particular our times together on the Pat and Dan Show, where he moderated lively discussions between former Congressman Dan Glickman, our state agriculture groups and myself. Our prayers are with the Flinchbaugh family during this difficult time.”

When he learned that Dr. Flinchbaugh had died, Dan Glickman, who served as Secretary of Agriculture from 1995-2001 and appointed Flinchbaugh to the Commission on 21st Century Agriculture, said “There will be a little bit of Kansas history lost. He has been my mentor for decades and will be fondly remembered for his wit, his wisdom and irreverence.” Glickman added, “He was one of the most unforgettable characters I’ve ever met.”

A Life of Accomplishment

Dr. Flinchbaugh served on a variety of boards of directors such as the Farm Foundation, advisory organizations like the 25x’25 Alliance and national task forces, providing input on domestic food and agriculture policy and serving as an advisor to industry and government leaders

Originally from York, Pennsylvania, Dr. Flinchbaugh earned a bachelor's degree in animal science in 1964 and a master's degree in agricultural economics in 1967, both from Penn State. He went on to earn a doctoral degree in agricultural economics from Purdue University. Dr. Flinchbaugh has been honored with Outstanding Teacher Awards three times by Kansas State University and has been recognized by the agricultural industry with several honors. He received a Distinguished Service Award from the American Farm Bureau and recently was selected as one of Farm Credit's 100 Fresh Perspectives, a national recognition for leaders making positive contributions to agriculture and rural communities. He was a lifetime member of Penn State's Alumni Association, its Ag Alumni Society and its alumni Stockman's Club.

He and his wife Cathy raised three children: David (deceased), James, and Katherine. He is also survived by two grandchildren: Henry and Piper. A celebration of Dr. Flinchbaugh’s life will be scheduled sometime after the pandemic is over. The family suggests that memorials be sent to the Kansas State University Foundation for the Flinchbaugh Agricultural Policy Chair (Account O64415), the Flinchbaugh Agricultural Policy Student Scholarship (Account O64410) or given to a charity of your choice in Barry's name. The Kansas State University Foundation is at 1800 Kimball Avenue, Suite 200, Manhattan, Kansas 66502-3373.

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Remembering A Friend and Agricultural Titan

U.S. Senator Jerry Moran, Kansas

Dr. Barry Flinchbaugh was an icon of agricultural policy in Kansas and throughout the nation. Dr. Flinchbaugh was well known for his involvement in helping craft farm bills for nearly five decades, and his authority on agriculture issues made him a trusted advisor to me and many prominent federal officials of both parties throughout his lifetime.

More importantly Dr. Flinchbaugh was my friend. We met when I called him more than 30 years ago to ask a question about Kansas tax policy. Ever since, I’ve admired and respected (loved) him. He spoke his mind, told me what he thought and made me a better senator and person. His death is a huge loss to me and all of his many friends, and it is hard to find the words to capture a man revered by so many. There may be no Kansan whose company I enjoyed more.

Each year, I would make a surprise visit to his ag policy class at K-State. His trademark sarcasm, wit and quips that made him a talented professor and a sought-after speaker was always on full display at the front of the classroom. I saw he loved and cared about his students and those feelings were mutual.

There is no doubt Dr. Flinchbaugh’s presence in ag policy will be felt for generations to come through the thousands of students he taught and mentored during his decades-long career as a professor at Kansas State. His loss will be felt deeply within the ag community, and Robba [wife] and I will be praying for Dr. Flinchbaugh’s family and loved ones during this time.

Latest News & Updates in KC Agriculture - November 2020

Developments

As COVID-19 cases and hospitalizations continue to rise in Missouri and across the Midwest, Governor Mike Parson signed Executive Order 20-19, November 19, 2020, extending the state of emergency in Missouri through March 31, 2021.  This will allow continued flexibility in deploying critical resources around the state as well as the continued utilization of the Missouri National Guard and easing of regulatory burdens to further assist Missouri’s COVID-19 response efforts. 

Farmer confidence is at its highest in the five-year history of Purdue University’s Ag Economy Barometer, the latest monthly results show. Confidence rose by 27 points to 183 in October, the highest reading since the barometer began in 2015. More farmers than ever said their farms were in better financial condition than a year ago, and a solid majority expected good times in the near to medium term, Chuck Abbott reports. “The late summer/fall rally in commodity prices, combined with government payments arising from the second round of the Coronavirus Food Assistance Program (CFAP2), appeared to be the primary drivers behind the sentiment improvement,” Purdue economists James Mintert and Michael Langemeier wrote.

Boehringer Ingelheim Animal Health announced a collaboration with Henke-Sass, Wolf to develop a needle-free injection device for pigs. The device, which is expected to be available beginning in December 2020 in most countries, will be called FreVAX through Boehringer and EPIG as part of HSW. (IHS Markit Connect) 

From the Land of Kansas is a trademark program designed to promote and celebrate agricultural experiences and products grown, raised or produced in Kansas. The From the Land of Kansas brand makes it easier for people to find and support Kansas-made products and Kansas-based businesses. The program, affiliated with the Kansas Department of Agriculture, offers an array of incentives to Kansas companies that grow, raise, serve or produce. “Purchases directly support small Kansas businesses and promotes local Kansas communities,” say Janelle Dobbins, marketing manager for the program. For information about holiday gift boxes and promotions contact Dobbins at Janelle.dobbins@ks.gov or 785-564-6759.

Brakke Consulting surveyed people in the animal health industry about their Thanksgiving plans and how they will change from last year.  About 17% of respondents said they spent last Thanksgiving at home with their immediate family. But this year that number will triple to 60%.  Likewise, 42% said they spent last Thanksgiving with extended family and friends. This year only 9% will celebrate Thanksgiving with a large gathering.  Interestingly, 28% said they would spend Thanksgiving with extended family (no friends) compared to 29% last year – not much change.

Trade teams from West and East Africa, Indonesia, Vietnam, Thailand, New Zealand, and Australia visited Kansas last month virtually, as the U.S. Grains Council hosted its Export Exchange Conference. The virtual event included a trade show, meetings and trade team visits with international buyers over Zoom. Kansas Corn, Kansas Department of Agriculture and K-State’s International Grains Program hosted a virtual trade show booth for Kansas grains, and Kansas Corn staff and leaders participated in the online Grain Exchange Conference. This year’s Grain Exchange overall hosted 1,207 registrants from 55 different countries.  The Kansas Corn Commission is a long-time supporter of the US Grains Council, which is based in Washington, D.C. and has offices around the globe.

Corteva Agriscience has been honored by the Utility Arborist Association as a recipient of the 2020 Partners in Excellence Award. Presented to companies that go above and beyond to support UAA and its mission, the award recognizes members, sponsors and volunteers committed to the enhancement of utility arboriculture and right-of-way management.

Kansas City Southern president and CEO Patrick J. Ottensmeyer, and executive vice president for Precision Scheduled Railroading Sameh Fahmy will address the Credit Suisse 8th Annual Virtual Industrials Conference on Thursday, December 3, 2020. Interested investors not attending the conference may listen to the presentation via a simultaneous webcast on KCS’ website.

A new study by the University of Illinois has an optimistic insight on the global agriculture industry’s consumption of ground and surface water, said to account for about 70% of the world’s supply.  According to the researchers, water use by the agriculture industry has actually decreased over a 15-year period, from 1995 - 2010. The comprehensive study looked at water withdrawals in U.S. agriculture and food production over that time period and found an 8.3% drop for crops and a 14% decline for livestock use. The downturn in water usage is a result of a combination of factors, such as increasing efficiency of the irrigation system, the growth of genetically modified crops, a change in domestic per-capita income and a changing of grown crops. A detailed PDF report of the study – What Factors Drive the Changes in Water Withdrawals in the U.S. Agriculture and Food Manufacturing Industries between 1995 and 2010? – is available at the American Chemical Society, ACS Publications.

Blockapps, an Albany, New York-based, blockchain platform provider has launched TraceHarvest Network with hope of transforming the way agricultural products are managed. The new blockchain-powered business network was developed in collaboration with Bayer. The platform will set new standards in sustainability, driving digital transformation and food system resiliency that will shape the future of the agriculture industry. More information available here.                        

Events

The pandemic has led many conference organizers to shift their farm industry events online this winter. The American Farm Bureau Federation and Commodity Classic have both announced their annual conventions will be held virtually in January and March, respectively. The Cotton Council will hold its Beltwide Cotton Conferences virtually, in January. And EuroTier is also going online this year, in February. Other conferences have been postponed, including the National Cattlemen’s Beef Association and the Midwest Poultry Federation. USDA’s Agricultural Outlook Forum is scheduled for the end of February, with details pending, and the National Farmers Union’s conference is scheduled to be held in person in San Francisco, also in late February. 

Farmers and crop specialists can hear updates from some of the nation’s leading agricultural researchers December 1-2 at the 2020 University of Missouri Crop Management Conference. Due to Missouri COVID-19 restrictions, this year’s conference is offered live online, said MU Extension weed scientist Kevin Bradley. Details and registration available here.

Kansas State University's Olathe campus is offering a workshop covering the regulatory aspects of animal drug and vaccine development. The workshop can be attended in-person at the Olathe campus or virtually: Animal Health Regulatory 101, 8:30 a.m. to 4:30 p.m. December 9-10. Attendees will learn how to navigate two of the federal agencies that oversee these products, FDA and USDA; as well as the requirements the agencies place on the development and maintenance of drugs and vaccines.

Kansas Farm Bureau will host its 102nd annual meeting December 3-5 with a mix of virtual presentations, as voting delegates will gather at 10 sites across the state to conduct business and set policy for 2021. “Annual meeting is where we celebrate the outstanding work of Kansas farmers and ranchers over the past year and set the agenda for the new year,” Kansas Farm Bureau president Rich Felts says. “This year the mission is the same, but the format will be different to protect the health and wellbeing of our members and their communities.”

People 

Born and raised on a hog and cattle ranch in Richland, Missouri, Air Force colonel and NASA astronaut Michael Hopkins, 51, is commanding the latest SpaceX operation bound for the International Space Station. The NASA mission will keep the crew occupied in space for several months. “When I was growing up at the Lake, going to the School of the Osage, I never would have thought that someday I was going to be sitting here getting ready to launch to the International Space Station in a brand new vehicle,” Col. Hopkins said prior to launch Sunday, November 15, 2020. From the farm to outer space, Missouri farm kid Michael Hopkins is continuing to fulfill a dream of space travel. At the University of Illinois he earned a Bachelor of Science in Aerospace Engineering in 1991, then a Master of Science in Aerospace Engineering from Stanford University. Hopkins joined the Air Force through the University of Illinois ROTC program.

David Patterson, a Chancellor’s Professor in the MU College of Agriculture, Food and Natural Resources (CAFNR) Division of Animal Sciences and state beef Extension specialist, was named an American Society of Animal Science (ASAS) Fellow. ASAS was created in 1908 and has supported both scientists and animal producers across the globe. Patterson’s ASAS Fellow honor came in the Extension category, which recognizes an individual who has given prominent service to the animal industry and has had continuous membership in ASAS for at least 25 years.

Two pioneers of the US animal health industry died earlier this month: Wes Remington and Dr. Bob Hummel.  

Wes Remington started his career at Anchor Serum as a sales rep and advanced to the position of president until it was sold to Boehringer Ingelheim.  He then started a number of companies, including Med-Tech (which later became Tech America); Agri Laboratories; Phoenix Scientific, one of the first companies to manufacture off-patent animal drugs; Phoenix Pharmaceuticals (known today as Clipper Distributing); and Pete and Mac’s Pet Resorts.  Wes was instrumental in the passing of the federal generic animal drug bill in 1984.  In the later years of his career, Wes was a very philanthropic individual for the animal health industry; and he was a key financial supporter of the Kansas City Animal Health Corridor at its founding.  

Robert Hummel DVM began his career in 1961 as a Technical Service Veterinarian with American Cyanamid Company.   In 1967, Hummel co-founded Great Plains Chemical Company (later changed to Lextron), which became one of the largest Animal Health distributors in the U.S with an emphasis towards the food animal protein segment. After a merger with Walco, the company name was changed to Animal Health International and was later sold to Patterson Companies.  

U.S. Senator John Boozman, R- Ark., will take over Republican leadership of the Senate Agriculture Committee after Sen. Pat Roberts, R- Kan., leaves. Sen. Boozman will either be chair or ranking member pending the result of the Georgia special senatorial elections in January.

Farm Journal, Lenexa, Kansas, has named Doug Edge senior vice president, revenue development for the company. In this new role, he will manage the producer sales groups with direct responsibility for crop sales while also providing strategic leadership to sales and business development groups and serving on the company's executive committee.

U.S. Senator-elect Roger Marshall, R-Kan., has named Brent Robertson chief of staff in his Senate office and Katie Sawyer state director. Robertson has been chief of staff in Marshall’s House of Representatives office since 2016 and Sawyer has been district director of his first congressional district office since 2017.  Source: Agri-Pulse Communications. 

Americans Can Save A Little on Thanksgiving Dinner

It remains to be seen whether Americans will be social distancing at their Thanksgiving gatherings, keeping masks on and silencing festive sing-alongs inside their homes, as some states have suggested or mandated. But one thing is clear. They will be paying a little less this year for the average traditional holiday meal. The American Farm Bureau Federation’s 35th annual survey shows the average cost of this year’s Thanksgiving feast for ten remains affordable at $46.90 or less than $5.00 per person. This is a $2.01 decrease from last year’s average of $48.91.

“The average cost of this year’s Thanksgiving dinner is the lowest since 2010,” said AFBF Chief Economist Dr. John Newton. “Pricing whole turkeys as ‘loss leaders’ to entice shoppers and move product is a strategy we’re seeing retailers use that’s increasingly common the closer we get to the holiday,” he explained.

Turkeys, the classic entrée on the Thanksgiving menu, will cost about $1.21 per pound this year or $19.39, down 7% from last year. AFBF’s survey results show that retail turkey prices are also the lowest since 2010.

The shopping list for AFBF’s informal survey of a typical Thanksgiving spread for ten people includes turkey, stuffing, sweet potatoes, rolls with butter, peas, cranberries, a veggie tray, pumpkin pie with whipped cream, and coffee and milk – in enough quantities to satisfy America’s love for Thanksgiving leftovers.

In addition to turkey, foods that showed slight price declines include whipping cream and sweet potatoes. Foods showing modest increases this year included dinner rolls, cubed bread stuffing and pumpkin pie mix. 

While turkey is the centerpiece of the Thanksgiving table, AFBF acknowledged the holiday’s dinner traditions have changed for some families. So its price survey also includes ham, potatoes and frozen green beans. Adding these foods to the classic Thanksgiving menu increased the overall cost by $13.21, to $60.11.  But even with these additional items, the cost of the expanded Thanksgiving meal is still down compared to 2019.

This year’s national average cost, says AFBF, was calculated using more than 230 surveys completed with pricing data from all 50 states. Farm Bureau volunteer shoppers were encouraged to check prices online using grocery store apps and websites due to the pandemic. They looked for the best possible prices without taking advantage of special promotional coupons or purchase deals.

Source: American Farm Bureau Federation

Polls Off the Mark in This Year’s Election

(L to R) Sara Wyant, Blake Hurst, Ron Seeber

A trio of savvy observers of agriculture policy and politics shared their takeaways from the 2020 Presidential and General Election during the Agricultural Business Council’s virtual November meeting. Ron Seeber, president and CEO of the Kansas Grain and Feed Association, the Kansas Ag Retailers Association, and Renew Kansas, concluded that from an agricultural perspective Kansas had a good night. As for the fortunes of the GOP, he said the state went from red to really red, as Republicans kept supermajorities in both the State House and Senate.  Tarkio, Missouri, farmer Blake Hurst, who also has served as president of Missouri Farm Bureau, called the elections in Missouri “a great night to be an incumbent.” 

Seeber noted “polls were way off the mark” in gaging the Kansas U.S. Senatorial race between Democrat Barbara Bollier and Republican Dr. Roger Marshall who garnered 53% of the vote. Sara Wyant, editor-in-chief of Agri-Pulse Communications was more critical of the pollsters, saying they were the biggest losers along with the media. “It is very discouraging,” she said, adding she is fearful of reportage in the future. 

Wyant offered several other observations that could bear weight in future election campaigns and outcomes. Total campaign spending topped $14 billion making it the most expensive election in U.S. history. She wondered if some of that money should have or could have been spent more wisely – on, say, people, institutions or organizations in need of a financial boost. Wyant raised a concern about how increasing out-of-state campaign contributions might influence voting that is not in the best interests of the citizens who actually live in a particular state.

On the subject of political donations, Wyant pointed out that women were “big donors” in this election cycle, and “politicians need to pay attention to females.”  Rural issues still matter, she said, in particularly rural healthcare and technology accessibility such as broadband availability. Noting that President Trump received more Hispanic votes than conventional campaign wisdom predicted, Wyant warned politicians that ethnic groups are no longer monolithic voting blocks to be taken for granted. 

All the speakers said they are wondering what the fallout will be from Democratic U.S. Congressman Colin Peterson’s defeat. As chair of the House Ag Committee, Peterson was considered a reliable legislator who worked both sides of the aisle on behalf of farmers and agriculture in general. Hurst wondered if the House Ag Committee would shift to the left.

Introduced as “the AgBizKC mystery guest,” Phil Karsting, who served as administrator of USDA’s Foreign Agricultural Service in the Obama-Biden administration (and who has been a frequent speaker at AgBizKC events), enumerated a list of priorities that could be top of mind for President-elect Biden’s transition team.  The agenda includes creating an effective supply chain to deal with COVID-19 in rural areas; creating a reliable labor force; expanding broadband coverage for rural users; focusing science and ag practices on the enhancement of soil health. Karsting also emphasized there is a place for biofuels in the energy sector of the country’s economy.

Ag CEO Council Briefs Presidential Campaigns

By Dennis McLaughlin, McLaughlin Writers LLC 

Earlier this month several national commodity and agriculture industry groups published a policy white paper for the candidates running for President of the U.S. It was written to assist and inform policy development undertaken by both campaigns regardless of the potential election outcome. The council comprises CEOs of a multitude of farm and commodity organizations and key supplier industries that speak for a large segment of U.S. agriculture.  The 12-page document lays out the current challenges facing the agriculture industry and defines the policy needs that will address those concern and improve the agriculture economy. The full report is available here.

Report In Short

The future of U.S. agriculture is bright. Agribusiness and production agriculture are a substantial part of the nation’s rural economy and can help lead positive change that creates a more just and equitable society.  Advancing U.S. agriculture into a new future will require a diverse, highly skilled and hardworking next generation of human talent. 

The current pandemic has magnified the importance of U.S. agriculture as well as the fragility of supply chains and its impact on the food security of our nation for all consumers. Food security sustains national security. America’s food and agriculture sectors are responsible for nearly one-fifth of U.S. economic activity, directly supporting 23 million jobs or 15% of U.S. employment, and contributes $7 trillion in direct and indirect economic output. Farmers and their agribusiness partners are the economic backbone of our rural economies. 

American farmers are independent and have diverse political alignment within our organizations. Therefore, member organizations of the Ag CEO Council do not endorse presidential candidates of either party, nor does the Council itself. But the campaigns would benefit significantly by being able to thoughtfully discuss the key issues that matter to the industry and to rural America – a constituency that historically has significant influence in electoral outcomes and whose issues resonate with the electorate. 

Priorities

Here is a summary of the Priorities for the Next Four Years and Beyond that the Ag Council of CEOs expects whichever party running the country to focus on:

• COVID-19 Vaccine & Testing:  The COVID-19 pandemic awakened many Americans to the realization that stocked grocery store shelves should not be taken for granted. The ag industry has stepped up to help meet demands in many ways. Development of a vaccine, access to widespread testing and PPE products, and development of a plan to address future pandemics should be achieved as quickly as possible to protect workers in the processing/supply chain, restore consumer confidence, and reestablish restaurant and institutional demand. 

• Farm Policy = Consumer Food, Feed, Fuel and Fiber Security = National Security: Farming is one of the most important and riskiest businesses in our nation and requires a strong safety net, on-farm conservation assistance, and risk management tools provided in farm policy. 

• Trade Agreements: Completed and ratified bilateral and multilateral agreements should have significant benefits to American agriculture. A functioning World Trade Organization is critical to U.S. agricultural trade.

• Biofuels: Continued support for the Renewable Fuel Standard (RFS), including increasing annual will be integral to the success of the biofuels sector and lead to greater reductions of greenhouse gas emissions.

• Research:  Immediate and intensive innovation is needed if agriculture is to feed 9 billion people or more by 2050. But this cannot be achieved without aggressive research. Public sector investments made into agricultural research have a very high return on investment, but federal investment in agriculture research has been declining. Breakthroughs and discoveries from land grand universities, USDA, and from private sector research are vital to improving our nation’s health and economy.

• Labor: Access to a stable, legal workforce is imperative for the success of U.S. agriculture. Each of the 2.4 million hired farm employees working on American farms and ranches supports two to three full time jobs further down the value chain. The current, experienced workforce must be preserved, and programs such as the H-2 visa programs must be maintained and expanded to meet all labor needs.

• Rural Broadband:  Access to broadband is absolutely essential for rural economies, health care, education and agriculture technology in order to retain the next generation of farmers. Some 24 million Americans lack access to broadband internet connectivity, 19 million of whom reside in rural America.

• Infrastructure and Competitive Modes of Transportation: Modern barge, rail and truck transportation are essential for the flow of inputs to the farm and products from farm to markets both domestically and abroad. Continued investment in improving infrastructure provides an essential underpinning not just to agriculture but to our entire economy

• Sustainability and Climate:  Agriculture accounts for less than 10% of total U.S. emissions, far less than transportation, electricity generation, and industry sectors. Farmers continue to produce more with greater efficiency. In fact, U.S. agriculture would have needed nearly 100 million more acres in 1990 to match 2018 production levels. The United States can and should lead by continuing to identify and utilize sustainable agriculture practices that preserve and protect our air, soil and water.

• Nutrition and Health: Consumers around the world have become more interested in and conscious of where their food and fiber come from, how it is produced and the nutritional value of what they eat. These market forces have created millions of jobs and spurred investment by the livestock and commodity industry by funding and finding responsible and renewable production methods and practices that bring greater nutritional efficiency to people around the world. 

Source: Ag CEO Council, Presidential Campaign Briefing; Agri-Pulse Communications; Feeding the Economy.com, 2020; USDA Economic Research Service, Farm Sector Income and  Finances 2020.

Latest News & Updates in KC Agriculture - October 2020

Developments 

USDA’s Foreign Agricultural Service reports U.S. dairy product exports totaled $4.4 billion from January through August this year, a 14% increase over last year’s corresponding time period. “U.S. dairy exports are posting positive gains in value and volume to markets around the world and are keeping pace with other animal product exports,” says Michael Dykes, president and CEO of the International Dairy Foods Association. “U.S. dairy exports are up in 8 of our top 10 export markets by both value and volume over the same period in 2019.” Australia, Canada, China and Vietnam were the primary importers of U.S. dairy products, Dykes said.  China imported about $344 million worth of dairy in the first eight months of 2020, a 38% increase over the January-August period last year.

Boehringer Ingelheim announced the launch of Vaxxitek HVT+IBD+ILT. According to the company, it is the first vaccine for poultry to offer protection in one shot from Infectious Laryngotracheitis, Marek's Disease and Infectious Bursal Disease. (PRnewswire)

Kansas State University researchers are developing facial recognition technology for the cattle industry. The technology builds on concepts used for human facial recognition; using unique facial features of individual cows that can be scanned and used to track the animal throughout its life.  A recent test of the network’s reliability, resulted in 94% accuracy. (Vet Advantage) Kansas State University is using artificial intelligence to build a database of facial recognition technology for the cattle industry. The system could boost biosecurity efforts and work into animal disease traceability systems, according to the university. Just like people, cows have unique facial features that modern technology can scan and later use to track the animal throughout its life, Kansas State said. “We’re talking about a system here that has an incremental cost that is close to zero, and nobody would be (forced) to use it,” said KC Olson, a beef cattle scientist with Kansas State Research and Extension who helped develop the idea. “There would be economic incentives provided by the beef industry to participate.” Human facial recognition is becoming more common in secure locations, such as airports.

Elanco Animal Health says it will restructure its business, eliminating more than 900 jobs, and has started to deleverage by making a $100 million payment on the loan that financed its acquisition of Bayer Animal Health. “Elanco leadership has quickly evaluated the capabilities, structure and staffing of the combined business required to meet its goal of being an agile, fit-for-purpose global leader dedicated exclusively to animal health,” the company said in a news release. “As part of this effort, today the company is announcing its intent to eliminate more than 900 positions across nearly 40 countries, primarily in sales and marketing, but also R&D, manufacturing and quality, and back office support. These actions begin to reduce duplication, drive efficiency and optimize the company’s footprint across geographies, particularly Basel, Switzerland.”

The U.S. Court of Appeals for the 9th Circuit rejected the North American Meat Institute’s legal challenge in a different California court brought by the National Pork Producers Council and American Farm Bureau Federation. Enacted in November 2018, Prop 12 imposes space requirements regarding breeding pigs and veal calves within California. The Meat Institute said Prop 12 creates a barrier to trade by imposing obligations on out-of-state competitors in an effort to assist local producers of pork and veal. Prop 12 reaches beyond the state’s borders by prohibiting the sale in California of uncooked pork or veal from animals housed in ways that do not meet California’s requirements. As a result, Prop 12 sets confinement standards for how pigs and veal calves are raised anywhere in the United States or in any foreign country.

The hog backlog peaked at 3.5 million head in late May, according to a Purdue University report. But it says farmers may see elevated prices by the end of the year as the hog supply shrinks. “It will take some time to work through the COVID-19 disruptions,” Purdue economist Jayson Lusk wrote in the quarterly Purdue Agricultural Economics Report. “Decisions to delay breeding or liquidate sows during the worst of the COVID-19 shutdowns [at packing plants] will likely help further reduce the backlog in the months ahead. These same decisions will likely imply a smaller market-hog supply, and thus possibly elevated hog prices, around the end of 2020.” While Lusk said hog prices will improve in the near future, the National Pork Producers Council said farmers need help now and urged passage of a new coronavirus aid bill.

Before the Butcher launched a new plant-based burger that matches the price of ground beef. Mainstream Plant-Based Patties was priced at about $5.50 per pound, similar to average prices of lean ground beef, according to the U.S. Bureau of Labor Statistics. Before the Butcher founder and president Danny O’Malley said the goal of the new product line was to produce a plant-based burger that was affordable to all consumers. While boxes of Mainstream have a suggested price of $10.99 per package of eight quarter-pound patties, other plant-based burgers can cost up to $8 at the grocery store for two patties.  Source: FoodDive, October 6, 2020; www.fooddive.com.

Most rural Nebraskans believe agriculture is a major driver of economic well-being in their households and communities, according to the University of Nebraska-Lincoln’s 2020 Nebraska Rural Poll. Rebecca Vogt, survey research manager of the poll, said, "Even those respondents who are not directly involved in farming or ranching, they do recognize that their communities are dependent upon the agriculture industry," Vogt said. "The different businesses in their community are affected by agriculture, and they recognize that tie.” But the poll results show only 40% of rural Nebraskans know anything about important agriculture policies in the state.

U.S. farmers remain optimistic in the latest Purdue University–CME Group Ag Economy Barometer reading. At 156, the barometer in September hit its highest reading since the pandemic began and 12 points higher than a month earlier. Producers were more optimistic about both current and future conditions than they were in August. Officials noted that the improvement coincided with the announcement by USDA of the second round of pandemic relief payments for producers. Additionally, fall crop prices rose, which also likely contributed to the rise in farmer optimism. 

Sales of both plant-based and conventional meats spiked at the beginning of the pandemic. But plant-based products saw a considerably larger spike, data shows. Nielsen found that March grocery sales of plant-based meat alternatives jumped 231% from the year before; IRI data analyzed by The Good Food Institute showed a 454% increase of plant-based meat alternatives from the previous year for the week of March 21. Conventional meat sales saw their largest year-over-year increase in March, at 40%, Nielsen said. Still, the U.S. meat market is worth about $95 billion at retail, while plant-based meat alternatives are worth about $1 billion.  

Wamego, Kansas – based U.S. CattleTrace has announced new partnerships in the states of Colorado and Iowa, increasing its number of partner states to 12 (Colorado, Florida, Iowa, Kansas, Kentucky, Missouri, Nebraska, Oklahoma, Oregon, Texas, Virginia and Washington). “As we continue our mission of developing the infrastructure for disease traceability in the cattle industry, partnerships in all segments of the industry remain crucial,” say Callahan Grund, executive director. Learn more on how to become a partner and to see a list of current partners at www.uscattletrace.org/our-partners.

People

During the CropLife America 2020 Annual Meeting, the Industry Task Force II on 2,4-D Research Data honored its own Jim Gray in memoriam with its the Lifetime Achievement Award. This award recognizes someone who has dedicated their life to successfully defending the pesticide industry with passion and professionalism. Jim served as the executive director of the Industry Task Force II for 12 years, from 2007 until the moment of his passing in November 2019. He was considered the heart and soul of the Task Force, bringing sharp wit, a broad smile, and an inexhaustible knowledge of all things 2,4-D. He had an extraordinary ability to connect with those around him and introduce people who share a common interest in agriculture, and a love for the land was felt throughout his travels from Europe to North America to Asia.

National 4-H Council president and CEO Jennifer Sirangelo (and lead presenter at the Agricultural Business Council’s May 2020 meeting) has been named winner of a Gold Stevie® Award in the Female Executive of the Year . The Stevie Awards for Women in Business is an international competition produced by the creators of the International Business Awards® and American Business Awards®. She will receive her award at a virtual ceremony December 9, 2020.

In August Look East received two AVA Digital Awards – one gold award and one honorable mention – for work done on behalf of clients Best Food Facts and Kansas Corn Growers Association. AVA Digital Awards is an international competition administered and judged by the Association of Marketing and Communication Professionals that recognizes outstanding work by creative professionals in digital communication. Look East submitted an entry for KCGA’s social media platform that featured a single kernel of corn – that work received honorable mention. LookEast’s short form video for Best Food Fact’s TASTE Tour garnered the gold. This year there were 2,500 entries from the U.S., Canada and 23 other countries. Sixteen percent of the entries won Platinum, the top award, and 21 percent grabbed Gold. 

The Kansas Department of Agriculture has selected Earl Lewis to serve as the chief engineer for the agency’s Division of Water Resources. As chief engineer, Lewis will manage the personnel and programs of KDA–DWR and administer laws related to conservation, management, use and control of water and water structures in Kansas. Lewis has dedicated his career to water resources in Kansas, including more than 20 years with the Kansas Water Office where has been serving as the director since December 2018. He began his career with KDA–DWR in 1992, and has been a licensed professional engineer since 1998. He received a Bachelor of Science degree in mechanical engineering from the University of Kansas.

Drs. Mike Tokach and Jason Woodworth, Kansas State University Department of Animal Sciences and Industry (ASI) professors, were presented awards by the American Society of Animal Science (ASAS) last week. Dr. Tokach is the recipient of the ASAS Fellow Award for research.  Dr. Woodworth is the recipient of the ASAS Industry Service Award. The awards were presented during the 2020 ASAS-CSAS-WSASAS Virtual Annual Meeting and Trade Show this past summer.

The first issue of JDS Communications, a new journal from the American Dairy Science Association (ADSA), has been published. Matthew Lucy, a professor in the Division of Animal Sciences at the University of Missouri College of Agriculture, Food and Natural Resource, will serve as editor-in-chief of the new publication. “JDS Communications will offer a fresh and different publication option for dairy scientists,” Lucy said. “We are interested in high-quality research studies that are focused, hypothesis-driven and designed to answer a specific question on the production or processing of milk or milk products intended for human consumption.” Along with serving as editor-in-chief for an ADSA publication, Lucy received the ADSA Award of Honor earlier this year. The award recognizes unusually outstanding and consistent contributions to the welfare of the Association or distinguished service to the Association. 

Events

Two professional development workshops on regulatory affairs in animal health are being offered by Kansas State University's Olathe campus. Workshops cover the regulatory aspects of animal drug and vaccine development, with options for introductory and advanced courses. The workshops can be attended in-person at the Olathe campus or virtually. Those who attend on campus are required to practice social distancing to aide in participant safety:

• Advanced Animal Pharmaceuticals, 8:30 am to 4:30 pm, Nov. 11-12: Workshop provides a detailed, practical and experience-based review of the veterinary drug approval process. Content covers the five topics that comprise the four major technical sections of a product submission to FDA's Center for Veterinary Medicine - chemistry, manufacturing and control; efficacy; target animal safety; human food safety; and efficacy for generic products.

• Animal Health Regulatory 101, 8:30 am to 4:30 pm, Dec.  9-10: Two-day introductory course on the regulatory requirements of animal drug and vaccine development. Attendees will learn how to navigate two of the federal agencies that oversee these products, FDA and USDA; as well as the requirements the agencies place on the development and maintenance of drugs and vaccines.

Agriculture Future of America launches its annual AFA Leaders Conference virtually, November 11. AFA Leaders Conference provides leader development and networking opportunities for college men and women who are preparing for careers in agriculture and food-related fields. Leaders Conference bridges the gap between academic, leadership and work experiences while helping students understand the impact of their decisions. Students are given the opportunity to network with peers and leaders in the agriculture industry as well as increase their excitement about the future of agriculture by creating awareness about career opportunities in food and agriculture. Program and agenda details available at www.agfuture.org.

U.S. Grains Crop Year “Off to a Great Start”

Ryan LeGrand, president and CEO of the U.S. Grains Council (USGC), had an optimistic story to tell about U.S. grain exports at the October virtual meeting of Agricultural Business Council of Kansas City. The U.S. crop year for exports is off to a great start, he said, in no small part because China has made a real emergence in the market.  “China is likely to be our top customer for this crop year,” he noted numerous times, “and the trade relationship [between the U.S. and China] is surviving [despite the trade war and tariffs].”

Coincidently, on the day LeGrand spoke to the Ag Business Council, USDA was finalizing its weekly trade data for the week of October 9-15 that would show China was making large-scale purchases of U.S. soybeans and corn, as well as cotton and beef. In that seven day period USDA reported the U.S. had shipped 1.96 million tons of soybeans and 363,000 tons of corn. To accent China’s debut as a major grains trading partner with the U.S., LeGrand presented figures showing that for the crop year 2018/2019 China was not even among the top ten importers of American corn. This year, however, China will be number one.

Pitching his advocacy of foreign trade, LeGrand said, “Failing to move forward on trade means falling behind.” He noted that 97.7% of the world’s population lives outside the U.S. and more than 97% of the anticipated population growth over the next 35 years will take place outside of U.S. borders.  Also, he pointed out that agriculture contributes positively to the U.S balance of trade. “U.S. agricultural exports valued at $137.4 billion in 2016 produced an additional $172.1 billion in economic activity for a total of $306.8 billion of economic output,” he said, which supported 1.1 million full-time jobs including 764,000 in the non-farm sector.   Closer to home, LeGrand said the total value of the grain trade to the Kansas economy is $2.2 billion; and $974 million to the Missouri economy.

Founded in 1960, the U.S. Grains Council is a private non-profit corporation with ten international offices and programs in more than 50 countries. Its membership includes producer organizations and agribusinesses with a common interest in developing export markets.

Latest News & Updates in KC Agriculture - September 2020

Developments

Elanco closed its acquisition of Bayer Animal Health. The transaction is valued at $6.89 billion, funded by $5.17 billion in cash and 72.9 million shares of Elanco Animal Health common stock issued to Bayer AG, corresponding to 15.5% of the U.S. company’s outstanding stock, and which will be subject to certain retention periods until mid-2021.

Farms could contribute billions more dollars to the U.S. economy with the help of precision agriculture technology. But this can’t happen without more broadband, said presenters during a National Telecommunications and Information Administration webinar September 23, 2020. Entitled Smart Agriculture: Driving Innovation in Rural America,the webinar featured, among other speakers, Megan Nelson, an economic analyst with the American Farm Bureau Federation. She shared research showing that U.S. farms could generate $18 billion to $23 billion annually if they had high-speed connectivity and adopted the latest technologies.  More information is available at www.fb.org/market-intel. 

Researchers in Australia have found that younger consumers are extremely concerned about processed products. Nearly three-quarters (72%) of Generation Z – born between 1995 and 2015 – say they are not ready to try lab-grown meat, according to a new study published in Frontiers in Nutrition. Many of these consumers cited environmental impact as a concern. The research at the University of Sydney and Curtin University, surveyed 227 randomly selected Australian-based members of Gen Z on their dietary preferences, how they felt about cultured meat and their preferences for meat alternatives.

Chinese wheat purchases picked up steam in August, according to recent data released by USDA’s Foreign Agricultural Service. China bought 250,800 metric tons of U.S. wheat in the fourth week of August, pushing the monthly total of purchases to 588,300 tons. China isn’t normally a major purchaser of hard red winter wheat, but COFCO, a state-owned importer has been buying hundreds of thousands of tons of it, according to U.S. Wheat Associates. Winter wheat accounts for 70 to 80% of total production in the US, with the largest amounts produced in Kansas (10.8 million tons) and North Dakota (9.8 million tons). The US hard red spring wheat crop is exported to over 70 countries each year to the extent of 55%.

Dairy Farmers of America has committed to reducing greenhouse gas emissions by 2030. Key strategies to achieve the goal, says DFA, include mitigating methane emissions from cows by supporting advances in feed efficiency, herd nutrition and feed additives designed to reduce emissions; using renewable energy methods, such as solar panels and wind power, on our farms and in our plants; and utilizing anaerobic digesters, which convert manure and food waste to energy, on farms and in plants. 

Thermo Fisher Scientific, Lenexa, Kansas, opened a new, 120,000 square-foot manufacturing facility in Lenexa where the company will produce viral transport media, the combination of buffering solution and plastic tubes that keep swab samples viable until they can be tested in the lab for the novel coronavirus. U.S. Senator Jerry Moran,Kansas Governor Laura Kelly and Lenexa Mayor Mike Boehm attended opening ceremonies August 28, 2020.

USDA’s National Institute of Food and Agriculture (NIFA) announced grant investments of more than $53 million across three unique programs for U.S. farmers, ranchers, and military veterans to support American agriculture. “Agriculture offers promising career opportunities, particularly in farming and ranching,” said Parag Chitnis, acting NIFA director. “Federal investments in programs that help new farmers get into the business, support military veterans who are considering farming and ranching as a new career, and address serious stress-related mental health issues among farmers, are critical to ensuring our next generation of food producers are able to successfully meet the challenges facing agriculture.”

USDA-NIFA also announced $9.6 million awarded to 17 projects that will equip military veterans with skills, training, and experience for careers in food and agricultural and may also offer workforce readiness and employment prospects. Moreover, these investments will strengthen the personal finances of rural military veterans and military families and help grow their communities.

USDA reported last week that U.S. export sales of soybeans and corn for the 2020-21 marketing year are keeping up their rapid pace. USDA on Tuesday announced sales of 460,000 metric tons of corn and 530,000 metric tons of soybeans, much of it heading to China according to the USDA’s Foreign Agricultural Service. Source: Agri-Pulse Communications.

People

USDA Deputy Secretary of Agriculture Steve Censky will be leaving USDA in November, returning to the American Soybean Association as CEO. Censky previously served in the same position for 21 years before coming to USDA. Part of his responsibilities managing the organization will be to work with the Board to finalize the plans for a permanent CEO, according to an ASA source. 

Private venture development organization TechAccel LLC, which invests in scientific breakthroughs to help solve global food crises, has named Brett Morris, CFA, vice president and director of investments.  He has been with TechAccel since 2016, most recently serving as principal, investment manager. In addition, TechAccel announced that Emily Aston, DVM, Ph.D., has joined their team as Science Advancement Manager. Aston has been working with TechAccel as a consultant since October 2019. In her new role, she will apply her veterinary and research expertise to science advancement in animal health and nutrition. 

The Missouri Highways and Transportation Commission announced Tom Waters, a Council member and past Dillingham Award Recipient as their new chair. John Briscoe is the new vice chair. Waters is a seventh-generation Missouri farmer and also serves as chairman of the Missouri Levee and Drainage District Association where he represents levee and drainage districts, businesses and others interested in the activities surrounding the Missouri River and its tributaries. Briscoe is a partner in the Briscoe and Brannon law firm with offices in New London and Hannibal. He served as the prosecuting attorney for Knox County in the late 1960s and as the prosecuting attorney for Ralls County in the 1970s. Briscoe grew up on a family farm that he continues to operate today.

The American Farm Bureau Federation and Missouri Farm Bureau presented U.S. Senator Roy Blunt with AFBF’s Golden Plow award. The Golden Plow is the highest honor the organization gives to sitting members of Congress. “Sen. Blunt is recognized well beyond Missouri as a strong advocate for farmers and ranchers,” AFBF President Duvall said. Throughout his tenure as a congressman and now as a senator, Blunt has demonstrated his commitment to agriculture in his leadership on issues such as improving flood control on the Missouri River, protecting farmers and ranchers from unnecessary regulation and securing river management priorities in the 2018 Water Resources Development Act, as well as his support for expanded trade. “Farm Bureau values the work he has done for our members across the country,” Duvall said.

USDA Deputy Undersecretary for Research, Education, and Economics, Dr. Scott Hutchins, announced that Dr. Spiro Stefanou will lead the Economic Research Service (ERS) as its new Administrator. Dr. Stefanou served as a Professor of Economics at the University of Florida’s Institute of Food and Agriculture for more than five years. He holds a Ph.D. in Agricultural Economics from the University of California, Davis, and an M.S. in Agricultural and Resource Economics from the University of Maryland, as well as a B.A. in Anthropology from George Washington University.

The Kansas Department of Agriculture and the State Conservation Commission have hired Andrew Lyon to serve as the executive director for the agency’s Division of Conservation. The KDA–DOC works to protect Kansas’ natural resources through the implementation of programs to support water conservation, water quality, land reclamation, and watershed management. Most recently, Lyon served in the watershed management section of the Bureau of Water for the Kansas Department of Health and Environment. Lyon received dual Bachelor of Science degrees in agricultural technology management and in natural resource and environmental science from Kansas State University, and a Master of Science degree in environmental science from Oklahoma State University.

Kansas corn grower, Kylee Geffert traveled to Palmer, Nebraska to participate in an RFDTV Cattlemen to Cattlemen series episode consisting of two panels, both focusing on how beef and corn work together to create a sustainable food system. The episode was made possible by the NCGA sponsorship of the Cattlemen’s Education Series working to provide cutting edge information to beef producers that contributes to increased knowledge, profitability, and sustainability. Geffert was a member of a panel discussing how beef and corn work together to create a sustainable food system. The panel also included: Kevin Ross, NCGA President; Mike Drinnin, owner of Drinnin feed yards; and Dr. Galen Erickson, University of Nebraska Ruminant Nutritionist.

BNSF has named Kathryn Farmer president and CEO effective January 1, 2021. She will continue her role on and assume leadership of BNSF’s Board of Directors. Carl R. Ice, current president and CEO, will retire at the end of 2020 and remain on BNSF’s Board of Director. Farmer has been with BNSF for 28 years, most recently serving as executive vice president of operations since September 2018. Berkshire Hathaway chairman and CEO Warren Buffett said, “BNSF is an iconic company and this is a historic day. Carl has been critical to BNSF’s success for a very long time. I thank him for his leadership and his accomplishments. We look forward to Katie’s leadership and more success. She possesses all of the qualities that make us excited about the future.”

Events

Two sponsors will be honored with the Distinguished Service Citation during the National FFA Convention & Expo, which will be held virtually Oct. 27-29. Bayer and Meredith-Successful Farming magazine will receive the citation for their outstanding contributions to FFA and agricultural education on the national level. Bayer has been a sponsor of FFA since 1954 and has contributed more than $22 million to the organization. Meredith has been a loyal supporter of FFA for the past 75 years, both financially and by telling the FFA story through its media outlets. The organization has contributed $1.5 million toward FFA. 

The Missouri Pork Association notes the MU Annual Swine Institute will be held Thursday, November 8, 2020 at the Pork Place in Sedalia. Details will be forthcoming at www.mopork.com/event/mu-swine-institute/.

The 77th Annual NAFB Convention takes place virtually November 18-20, 2020. For more information on the 2020 NAFB Virtual Convention, go to www.nafb.com. 

Trade Tops Conversation at Ag Outlook Forum

DIGGING DEEPER…….

This year’s Ag Outlook Forum, presented by the Agricultural Business Council and Agri-Pulse Communications drew another record audience of almost 300 agricultural economy leaders from the region. Attendance was all the more remarkable considering that less than half were gathered at Kansas City Marriott Downtown with social distancing precautions in effect. The annual symposium was a virtual/hybrid meeting. Agri-Pulse founder and president Sara Wyant opened the forum noting the program was designed to offer insight on “what you can expect in an exceptional situation,” referring to the COVID-19 pandemic. Missouri’s U.S. Congressional Representative Emanuel Cleaver II welcomed the audience virtually from “the city of peace, love, congeniality and collegiality – otherwise known as Washington. D.C.,” sarcastically referring to the current divisive atmosphere of the Capital.

By Dennis McLaughlin, McLaughlin Writers LLC

Trade Tops Conversation at Ag Outlook Forum

Gregg Doud, chief agricultural negotiator at the Office of the United States Trade Representative, said it is feasible to think China could meet its Phase One trade commitment with the U.S. to purchase at least $36.5 billion in agricultural products by the end of the year. He pointed to China’s increasing agricultural imports – China imported $124 billion from the world in 2018 and $133 billion in 2019.  The country is on course to import $141 billion in 2020.  When looking at it from that vantage point, Doud said China's Phase One commitment to the U.S. (from $24 billion for the base year of 2017 to $36.5 billion [this year]), is possible.

Despite an absence of in-depth media and federal department updates regarding U.S.- China trade negotiations, progress is taking place.  Doud said his team and the Chinese “are talking.” He noted in the last three years 33 major ag negotiating sessions have taken place. He also pointed out that negotiations aren’t limited to volume, price and delivery concerns. There are structural processes that need to be agreed upon, like the number of U.S. facilities and enterprises, for example, that the Chinese would approve for exporting activity with China. Before the Phase One agreement, only 1,500 U.S. facilities were eligible. Now there are 3,500. Issues still being worked out pertain to the use of ractopamine and biotechnology.

Doud said structural changes actually are a significant advancement not discussed often. The original agreement called for 57 structural changes, and Doud estimates that China has completed 50 of those. Outstanding issues pertain to the use of ractopamine and biotechnology. Additionally, the parties have been addressing steps China needs to take to ensure greater protections or intellectual property rights, remove impediments to American companies in the areas of financial services and the elimination of forced technology transfer.

Even if China's purchase commitments are not met, the two countries will continue the dialogue and discussions. “China indicated they intend their very best to do this,” Doud said, adding, “It isn’t just rhetoric; they are making purchases.” 

Got Milk?

Gregg Doud also made note that ag products comprised the “biggest” lot of Phase One exports to China.  And dairy products are the “biggest” component of the ag sector. Former USDA Secretary Tom Vilsack concurred. Now president and CEO of the U.S. Dairy Export Council, Vilsack said his group and the dairy industry are encouraging China to buy more cheese and incorporate whey into national protein consumption programs.  Agri-Pulse’s Sara Wyant pointed out that the dairy industry was a leader in creating new food products.  To put down a bigger footprint in Asia, Vilsack mentioned the USDEC’s involvement in establishing a Center for Dairy Excellence in Singapore.

There are challenges for the dairy industry. Vilsack stated, “Canada has already begun implementing USMCA in a way that thwarts its market access promises and prevents U.S. dairy from making full use of the benefits that Congress and the Administration fought so hard to secure. There are also unanswered questions concerning how Mexico will translate its commitments to safeguard common-name cheeses into action. These are unresolved concerns that affect everyday dairy farmers and workers across our industry.”

Doud said he is watching the implementation of USMCA, particularly the situation with dairy in Canada. Another important focus will be the biotechnology situation with Mexico. Two key issues included in the USMCA deal are the biotechnology component and the enforcement mechanism. Doud said the new enforcement mechanism is something he believes the U.S. will really be able to “utilize in a fashion much more quickly than we had previously been able to use.” He added, “We will not hesitate to use enforcement tools we have in USMCA, if necessary.”

Other Trade Issues

Blake Hurst, president of Missouri Farm Bureau, introduced a panel discussion on trade issues saying, “With trade we always have issues.” He sees a change in Americans’ attitude toward trade, and thinks they may consider it not that important to the overall economy. He related a training and mentoring program with ten young, upcoming men and women managers working for several top tier agribusiness companies in Indiana.  After an all-day session, he said he was surprised that none of them brought up the role of trade in the ag industry.

Panel participant Jim Sutter, CEO, U.S. Soybean Export Council, described soybean producers as “brilliant at what they do no matter what nature throws at them.” He was talking about COVID-19 as well as weather and climate incidents. “The world relies on [the U.S.] for soybean supplies,” he explained. “We use 40% of our crop at home and export 60%.” And 60% of those export shipments go to China.

China is buying U.S. soybeans at a record pace, Sutter said, but the total this year won’t beat previous record levels, and Chinese commitments under the Phase One deal won’t be realized this year.  “As far as the actual trade goes, I think it’s unlikely that China will import half of the two-year commitment of the Phase One deal in the first year.” China committed to $80 billion of U.S. ag goods throughout 2020 and 2021.  Sutter predicted China would import 36 million metric tons of U.S. soybeans this calendar year, roughly the same amount as the country imported in 2016.

In 1995, the U.S. was a net importer of pork. “Today, we export 30% of our pork products,” said Bill Even, CEO, National Pork Board. U.S. pork exports support 110,000 jobs. He commented that the U.S. pork industry has effective reciprocal trade agreements around the world, and its production efficiencies make U.S. pork least expensive globally.  

Trending On The Farm 

USDA Deputy Secretary Steve Censky told the Ag Outlook audience that support for farmers is strong at high levels of all government agencies and departments. But he mentioned that the USDA considers another round of Market Facilitation Program payments unnecessary, in light of additional coronavirus relief for producers coming in the next couple of months.

The MFP was created in 2018 and repeated in 2019 to compensate farmers for losses due to China’s retaliatory tariffs and other trade barriers. “We have our exports that have been growing, and we expect to see those continue to grow, and we see no need” for more MFP payments, Censky told Agri-Pulse at the Kansas City forum. 

Federal Reserve Update

Kansas City Federal Reserve Bank president Esther George provided an optimistic assessment of the U.S. economy. But she had a cautionary message. The economy is working, she said. “The good news is the economic recovery is underway – quicker than I thought.” She credited the rebound to the general resiliency of the U.S. economy, the resolve of the American spirit and the fiscal stimulus programs. “The diversity of our economy has really come through,” said George. “Our economy is a microcosm of the thousands of industries in the country.”  But, she warned: “We’re not out of the woods yet.” 

Labor took a huge hit at the pandemic’s outset, losing 22 million jobs with lockdowns and shelter-in-place ordinances. George, however, pointed out that recent government statistics show that half of that furloughed demographic has returned to work, and the unemployment rate is 8.4%.   She also described a new perspective catching on at the Fed: Unemployment can drop lower than expected without “necessarily” causing inflation. 

George commented that the Fed has been proactive in addressing a bleak outlook for some community banks. The nation’s banking system is diverse with more than 10,000 banks, several thousand of which are categorized as small. “Policy makers must understand the dynamics of small banks.”  

Land Values

Interest rates are a prime determinant of farmland since the early 1900s, said Steve Bruere, president, Peoples Company. The relationship between interest rates and farmland is inverse in that an increase in interest rates should pressure farmland prices lower, and alternatively, a decrease in interest rates should support higher land values. The current interest rate environment is much more favorable than that of a year ago and should cause the farmland market to trend higher.  Bruere suggested there is a “huge demographic shift” in who is buying farm land, and outside capital is pouring in. “As farms get larger you need outside capital.”

Going Forward

USDA Chief Economist Rob Johansson told Agri-Pulse Communications, co-host of the Ag Outlook Forum, that the new round of coronavirus relief payments will help shore up farm income heading into 2021. He said about $6 billion in payments from the second round of the Coronavirus Food Assistance Program would reach farmers in the first part of 2021. Johansson forecasts higher revenue next year for livestock producers, but net farm income is expected to be down because of an overall decline in government payments. 

Highlights of Johansson’s presentation are shown below. Detailed data and stats are available at the USDA Office of the Chief Economist: www.usda.gov/oce.

Outlook for U.S. Agriculture

• Unprecedented shock to all economic sectors

• IMF forecasts continue be revised downward

• Agricultural commodities most closely linked to macroeconomic conditions have seen largest declines

• Net cash farm income and net farm income are forecast to increase in 2020.

• Net returns and government payments are forecast to increase, net crop insurance indemnities are anticipated to decline

• Debt-to-asset ratio remains low --- 13.95%, and debt financing cost falling despite total debt at historic levels

• Farm bankruptcy rates are slowly increasing

• Record production projected in 2020 --- slightly lower

• US beef production expected to slowdown in 2020 but pickup in 2021

American Farm Bureau Federation’s Chief Economist John Newton talked about the future of the farm safety net. The second round of the Coronavirus Food Assistance Program will provide additional much needed financial support for livestock producers, crop producers, specialty crops, as well as nursery, floriculture, specialty livestock, tobacco and several other commodity categories.

Some of the topics covered in his presentation are shown below. Detailed data and stats are available at www.fb.org/marketintel. 

Future of Farm Safety Nets

• 2014: Move Toward Payments That Are a Function of Crop Prices in ARC-CO and PLC

• Without Incentives: Cover Crop Acres Planted in 2020 Dropped to 2.3 Million Acres

• U.S. Farm Income and Expenses

• Can “Greening” Payments Make U.S. Agriculture Part of the Solution?

• Net Farm Income with and without  Federal Support

• What Won’t Work Long-Term: Set Aside Programs

Top Ag Negotiator Sets Sights On Africa, UK, EU

By Dennis McLaughlin, McLaughlin Writers LLC

In an upbeat presentation at the 2020 Ag Outlook Forum hosted by the Agricultural Business Council and Agri-Pulse Communications, Gregg Doud, chief agricultural negotiator at the Office of the United States Trade Representative, enthusiastically mapped out the way the U.S. will approach better trade agreements in key global markets. While his report focused largely on China (see Digging Deeper for full coverage of the Ag Outlook Forum program), his briefing on the trade opportunities with the EU, UK and Africa warrants a special report here.

Doud told attendees at the forum that the United States and the United Kingdom wrapped up the fourth round of trade talks this month. Another round is planned for mid-October. “I’m confident that we are going to get an opportunity to engage with them and work on such issues as tariffs, biotech and market opportunity. He noted tariffs on U.S. products will be high, close to 25%, when the UK leaves the European Union. But the U.K. imports $4.5 billion worth of beef, pork and poultry from the European Union. Doud reasons: “If we can get things right, I think we will have a fair shot at that, giving U.S. meat producers a new market.”

Doud is pessimistic about reaching a trade accord with the EU in the near future. “It is all the more difficult when you’re dealing with 18 or so Eurozone nations with special, national interests of their own,” he explained. But one of the biggest obstacles is the EU’s abandoning of bio and ag technology. Doud said the U.S. would make no apologies: “We’re going to use technology; it’s the way forward toward feeding nine billion people by 2050.”

Another bright spot on the U.S. foreign trade map is Africa. The U.S. has initiated negotiations with Kenya. “That’s our first entrée into the continent of Africa,” said Doud, adding that a successful deal with Kenya would send “a really strong signal with regards to the use of technology in agriculture.” That in turn could lead to deals with other African countries, many of which still follow in the footsteps of the EU, which openly distrusts biotechnology, Agri-Pulse reported. One key demand from the U.S., as it negotiates a free trade agreement with Kenya, is that the East African nation abolish its ban on most biotech crops. “Most farmers depend heavily on GMO seeds, and would like to see a success in Kenya spread throughout Africa,” said Doud.