Digging Deeper...

With the exception of paper towels and toilet paper, no other grocery category captured more attention and created more concern among consumers than meat products – or rather the shortage of them – during the spring 2020 outbreak of COVID-19. Agriculture economists morphed into media mavens appearing on just about all the network and cable television news programs and contributing articles and analysis to major newspapers and news syndicates. The crisis in meat aisles and at butchers’ counters everywhere was a shock. But not necessarily unforeseen. By Dennis McLaughlin, McLaughlin Writers, LLC

COVID-19 Exposed  Animal-To-Meat-To-Market Bottleneck

… And The Need For Local Smaller Processing Plants 

Back in July 2020 speaking virtually at the Agricultural Business Council’s meeting, Glynn Tonsor, Ph.D., Professor, Kansas State University’s Department of  Agricultural Economics, singled out  a couple  of  “shocks” the meat industry absorbed with COVID-19. The first one was the shift to social distancing and self-quarantining from mid-March through April. With millions of Americans staying closer to home, the meat industry had to reevaluate the benefits and costs related to its retail, food service and export channels.  Shock number two, he said, was the “animal-to-meat bottleneck” in April and May 2020, creating a surplus of animals and a shortage of meat in stores.

In follow up remarks a few days after speaking at Kansas State University’s recent annual Cattlemen’s Day Symposium, March 5, Jayson Lusk, Ph.D., Distinguished Professor and head of the Department of Agricultural Economics at Purdue University, said, “Supply chains for many agricultural products have an hour-glass shape; and in between a sizable number of farmers and consumers is a small number of processors.”

The concentrated nature of the meat processing sectors in the U.S., Dr. Lusk wrote in a March 11, 2021 follow-up post, implies that disruption of the processing capacity of any one plant from accidents, weather or, case-in-point, pandemic illness can lead to system-wide disruptions and possible meat shortages. At the KSU symposium, Dr. Lusk pointed out that ten processing plants slaughter 63% of all cattle and 15 plants slaughter 59% of all hogs.  

Small Plants Get Traction

In the wake of supply problems caused by processing plant closures last year, one solution has become increasingly expedient: Expand the number and size of smaller meat processing operations to reduce reliance on big plants. Movement in this direction started in May 2019 when a bipartisan group of Congressional representatives proposed legislation to amend the Agricultural Marketing Act of 1946, which would direct the USDA to make grants available for improvements to meat and poultry facilities and to allow for interstate shipment, as well as for other purposes.  

But it has been states like Kansas and Missouri that have made significant moves to smooth the way for small plants to develop capacity and proficiency to take up the slack in meat processing and packing. 

The Coronavirus Aid, Relief and Economic Security (CARES) Act passed in March 2020 paved the way for states to access federal funds to create grant programs to aid local small meat producing and processing businesses to upgrade their facilities. Last May, Kansas Governor Laura Kelly introduced the Strengthening People and Revitalizing Kansas (SPARK) Taskforce to rebuild Kansas economy. At the time, Gov. Kelly said, “The state’s recovery effort must serve urban and rural areas alike across the state and all sectors of the economy.” Small food animal producers and processors received grants to maintain their operations and upgrade facilities.

By the end of last year SPARK approved more than $130 million in relief funding for economic development and connectivity in the state. Federal allocations were provided in the form of grants to eligible businesses through the Kansas Department of Commerce. The Kansas Livestock Association (KLA) and the Kansas Department of Agriculture supported  the need for assisting small processors in capacity-related improvements. 

In particular, KLA urged its members to look into the Securing Local Food Systems grant program, created to support small meat processing facilities, food processors, food banks, local direct-to-consumer producers and retail outlets “to address supply chain disruptions as a result of the pandemic.” The program is based on the need to increase capacity of local food systems. Specifically, KLA said the program was targeted at small meat processors needing funds to expand cold storage, upgrade equipment and renovate or expand existing processing areas. 

Across the state line, the Missouri Meat and Poultry Processing Grant Program was created to support Missouri meat and poultry processing facilities to address COVID-19-related supply chain disruptions. Missouri’s General Assembly appropriated $20 million in federal funds from the CARES ACT to help support these facilities. Missouri Department of Agriculture said grants were intended to incentivize small facilities to increase livestock or poultry slaughter and processing, and to become an inspected or exempted facility in the near term. MDA maintains that increasing slaughter and processing facility capacity will add resilience to the mat supply chain.  

In the last week of December 2020, Congress passed an additional $900 billion coronavirus relief bill that included $60 million in grants for small meat processors, reported KOSU, an Oklahoma public radio outlet. “Up to $200,000 in grants can be used to update or expand a small processing facility to meet USDA inspection standards,” wrote KOSU editor Seth Bodine. Updating to federal inspection standards would mean the meat could be sold across state lines, he explained.

Gaining Momentum

On September 29, 2020 U.S. Congressmen Chellie Pingree (D-MA) and Jeff Fortenberry (R-NE) introduced legislation – Strengthening Local Processing Act – that would increase the federal share of costs for state inspection from 50% to 65%. For Cooperative Interstate Shipment (CIS) facilities, the fed’s share would bump from 60% to 80%,  encouraging more states to operate state inspection programs and participate in CIS.  Specifically, the Strengthening Local Processing Act intends to accomplish these imperatives:

• Increase the federal share of costs for state inspection from 50% to 65%. There are 27 states that operate a state inspection program.

• Increase the federal share of costs for state inspection for Cooperative Interstate Shipment (CIS) facilities from 60% to 80%. There are eight states that participate in CIS.

• Authorize competitive grants to small and very small establishments, state inspected facilities, custom exempt facilities, or new small-scale slaughter facilities for activities related to COVID-19 response and recovery.

• Authorize a $10 million grant program for colleges and universities to establish or expand meat processing training programs.

• Authorize a $10 million grant program for small and very small establishments or nongovernmental organizations to offset the cost of training new meat processors.

Meanwhile Back At The Ranch

Referring to the Strengthening Local Processing Act, Christopher Young, executive director of American Association of Meat Processors, said it “will be a game changer for small processors.” Federal and state relief packages, programs and grants to spur processing plant development and expansion are indeed having a positive impact. 

But with the recent growth in business for small plant operators, there has been growing pains.  Liz Boyle, Ph.D., professor of Meat Science in the Department of Animal Sciences and Industry at Kansas State, noted a number of challenges facing small processors during her presentation at Kansas State’s Cattlemen’s Day Symposium. One obstacle is labor. “Everybody’s working overtime, trying to keep all of the customers happy,” said Matt Carselowey, president of Kansas Meat Processors Association (KMPA),  which represents about 50 small processors in the state. 

Another processor in Kiowa, Kansas, secured funding grants to cover repairs and new equipment to take on increased demand. It also added five new employees. “It’s a whole lot more stressful,” a manager told Dr. Boyle. “I’ve never had to keep a calendar a year out until this year; it’s just made everything harder to keep track of and [added] more paperwork.” The manager also remarked that his facility could be adding a second shift. “And I’ll be sleeping less.”   

Dr. Boyle recalled that over the last decade or so many industry and public service campaigns have been launched to encourage consumers to get to know their farmers and learn more about where their food comes from. While the coronavirus pandemic accented some vulnerabilities in the meat processing industry, it inadvertently may be responsible for prescribing Americans with a much-needed Rx for positive nostalgia. The reemergence of smaller local meatpacking facilities and a greater demand for retail beef and pork has reminded the public that local processing is still round, she said.  “And it is a good way to support local business.”

Source: Proceedings, Kansas State University Cattlemen’s Day Symposium, March 5, 2021; Jason Lusk, Ph.D., Distinguished Professor, Department of Agricultural Economics, Purdue University; Agricultural Business Council of Kansas City, July 2020 Newsletter; Glynn Tonsor, Ph.D., Professor, Kansas State University’s Department of Agricultural Economics; Liz Boyle, Ph.D., Professor,  Meat, Science, Department of Animal Science  and Industry, Kansas State University. 

Driving Ethanol Demand

Emily Skor, CEO, Growth Energy

At the Council’s March meeting, Emily Skor, CEO of Growth Energy, presented a buoyant outlook for her industry.  Despite the myriad challenges brought on by COVID-19, 2020 was a good year for ethanol.  She noted that retail growth for E-15 expanded with the number of retail sites selling E15 increasing 10%. Now more than 2,300 stations across 30 states are making E15 available to consumers. She described this boom as not just “a road to recovery, but the expressway to growth.” 

Currently Growth Energy is working with a list of leading retailers – including Casey’s, Cumberland Farms, Family Express, Holiday, Kum&Go, Kwik Trip, Minnoco, Murphy USA, Protec Fuel, QuikTrip, RaceTrac, Royal Farms, Rutters, Sheetz and Thorntons – to give more drivers access to cleaner burning, high octane E15 throughout the U.S. 

On March 9, 2021, two days before Skor addressed Council members (March 11), Growth Energy announced that American drivers across the nation reached a major milestone, logging 20 billion miles on the road since E15 blends were approved.  “In an unprecedented year,” Skor said, “hitting this milestone is a huge testament to the benefits E15 offers drivers who use it and retailers who sell it.”  Opening new markets is at the heart of Growth Energy’s mission, she added, further explaining that it expects to grow demand through effective policy solutions, accelerated market choice and access, as well as enhancement of global confidence in ethanol. 

To expedite this strategy, Skor explained that Growth Energy would continue to work with the top 20 retail chains; target additional efforts toward the top five markets; position E15 as the primary fuel product to replace E10; enhanceits relationship with terminals already offering E15.  Growth Energy also intends to influence and advance USDA’s Higher Blends Infrastructure Incentive Program (HBIIP).

The Kansas City Metro Area, including surrounding towns and counties in both Kansas and Missouri, already has a sizeable E15 footprint, Skor pointed out. And as coincidence would have it, the day after her Council presentation the Environmental Protection Agency (EPA) announced on March 12 that it was allowing E15 fuels to be sold year-round in the region.

“This announcement is a big step for the Kansas City metro area and a continuation of the hard work being done there to improve air quality and address environmental issues,” said Skor in a release. “Allowing the year-round sale of E15 will help strengthen these clean energy efforts and give more Kansas Citians access to cleaner, more affordable fuel options. A recent report found that nationwide, switching from E10 to E15 would reduce greenhouse emissions by almost 20 million tons per year. Ethanol environmental benefits are tangible and will help continue Kansas City’s efforts to protect human health and contribute to our country’s overall efforts to decarbonize the transportation system.”

Relocating NIFA and ERS to KC Metro

It’s been almost two years since USDA announced it was relocating two of its agencies to the Kansas City Metro Region.  About a year ago USDA actually initiated the change of addresses for both the Economic Research Service (ERS) and the National Institute of Food and Agriculture (NIFA), and began moving staff to the Kansas City area. Lately, however, there have been rumblings in the media and from government watchdogs that the move isn’t moving fast enough and staff positions aren’t being filled very quickly. 

But there are always going to be growing pains with a transition of this magnitude. People in the know, like Scott Brown, Ph.D., Associate Extension Professor at the University of Missouri’s Division of Applied Social Sciences and College of Agricultural, Food and Natural Resources, have a different, more optimistic perspective on these developments. Dr. Brown said that although ERS and NIFA are not fully staffed they are making progress. “It’s amazing how well they have done in the middle of a pandemic.” 

For example, as of February 2021, USDA released a report indicating NIFA had 221 employees on board and 122 vacancies. Recruiting is actively underway, and prospects for populating the positions are more than favorable. Consider this: Six premiere  land grant institutions – Kansas State, University of Missouri, Oklahoma State, University of Nebraska, Iowa State, and University of Arkansas – are within 300 miles of the Kansas City metropolitan area. That represents a gusher of ag talent, adds Dr. Brown, as new ag grads, graduate students and ag professors seeking a career apply for jobs with NIFA and ERS. 

In April, the Agricultural Business Council of Kansas City will Dig Deeper into all the ramifications of the USDA’s initiative to relocate ERS and NIFA to the region. 

MoKan NAMA Book Drive to Promote Ag Literacy

The MoKan NAMA Book Drive to promote ag literacy for elementary aged school children is off and running! They have established a list of ag-centric educational books for the drive on Amazon. Check it out and then choose from one of the three convenient donating options:

1. Purchase books and mail them to: Ceva Animal Health, Attn: Jody Donahue, 8735 Rosehill Road, Suite 300, Lenexa, KS 66215.

2. Mail a check with donation to: Woodruff, Attn: Scott Lynn, 331 Southwest Blvd, Kansas City, MO 64108.

3. Make a credit card donation here.

Donations must be received by April 9, 2021.

Latest News & Updates in KC Agriculture - February 2021

Developments

Missouri Governor Mike Parson proclaimed February 20-27, 2021, as National FFA Week in Missouri on behalf of nearly 26,000 members of Missouri FFA. Missouri FFA President Justin Eddy of Columbia received the proclamation on behalf of the 2020-2021 Missouri FFA State Officer team. “Missouri agriculture has a bright future, and you can see that in action through our FFA members,” Gov. Parson said. “Living and working on a farm is one of my greatest honors, and the First Lady and I continue to look to these young leaders to move the agriculture industry forward for generations to come.” For the third year in a row, Gov. Parson drove a John Deere tractor to the State Capitol in honor of the FFA tradition of students driving their tractors to school during National FFA Week. 

The Senate voted 92-7 Tuesday, February 23, 2021 to confirm Tom Vilsack as USDA secretary, his second run at the Cabinet post. The former Iowa governor spent eight years leading the same department for former President Barack Obama’s entire administration. In his testimony, he proposed “building a rural economy based on biomanufacturing” and “turning agricultural waste into a variety of products.” He pledged to work closely with the Environmental Protection Agency to “spur the industry” on biofuels.

The National Dairy FARM Program has published its 2020 Year in Review. Serving as the annual summary of the achievements and program developments of the FARM Program, the Year in Review showcases successes and challenges during a year of change and uncertainty. The Review can be downloaded from the website here, for a printed copy, contact dairyfarm@nmpf.org.

New analysis of EPA data highlights agricultural emissions reduction and the importance of developing new research and technologies to capture more carbon in cropland and pastureland. AFBF’s latest Market Intel also reviews trends in U.S. carbon sequestration as climate-smart farming practices increase. The report reveals that U.S. carbon sinks offset 12% of U.S. greenhouse gas emissions and sequestered 764 million metric tons during 2018. The largest carbon sink involved U.S. forestry lands. More information is available here.

In Kansas, home to about 1.5 million beef cows, ranchers are working around the clock to make sure newborn calves survive and cattle have access to food and water. Matt Teagarden, CEO, Kansas Livestock Association, says the cold weather “definitely refocuses folks” to checking on cattle and finding calves. Source: Agri-Pulse Communications

Farm states are likely to lose more influence in the U.S. House because of population shifts that are expected to result in lost seats across the Midwest as well as in Pennsylvania and New York. The results of the 2020 Census are not expected to be released before March, but analysts expect the states losing seats to include Illinois, Ohio, Michigan and Minnesota. State legislatures, and in some cases independent commissions, are responsible for drawing new districts based on the Census results. In most cases, the lost districts are likely to come out of rural areas. Source: Agri-Pulse Communications.

Lathrop GPM managing partner Cameron Garrison spoke with the Kansas City Business Journal on the first year of the formation of Lathrop GPM and the successes achieved through the combination, including during the COVID-19 pandemic.  Cameron said, “Going through a crisis like that, it brought us [Lathrop and GPM] together tighter, so it moved us forward faster than we thought.”

A survey of more than 3,000 American consumers shows beef is currently chosen about three times more often than plant-based alternatives. But while the plant-based presence in the market remains small, it is growing. The study, funded by the Beef Checkoff and conducted by ag economists Glynn Tonsor, Jayson Lusk and Ted Schroeder, found beef has good consumer perceptions on taste, appearance, price, and on nutrition qualifiers such as protein and iron content. Consumers also perceive beef to be better overall for farmers, consumers, and rural communities. But plant-based alternatives score highest on animal welfare, health and environmental concerns and have better scores than beef for cholesterol, fat and dietary fiber. Consumers of plant-based alternatives are typically younger, have children under the age of 12, have a higher household income, and are Democrats residing in a western state, the study noted.

Exports of U.S. beef and pork experienced a strong finish to the calendar year in December, beating 2019 figures and offering insights into consumer trends around the world and what is yet to come in the new year. According to USDA data analyzed by the U.S. Meat Export Federation, pork exports in 2020 topped the 2019 record by 11%, reaching nearly 3 million metric tons. Value of pork exports also shot up 11% to a record $7.71 billion. Beef exports finished 2020 with annual totals lower than the previous year – down 5% in volume and value – but ended the year with fourth-quarter volume up 4.5% over 2019 figures.  The pork sector set export records in China, Central America, Vietnam and Chile; U.S. beef exports to China and Taiwan set records for the same time period. Exports of U.S. lamb were up 27% by volume but fell 9% in value to $23.8 million.

The Ag Economy Barometer, a monthly measurement of farmer sentiment from Purdue University and the CME Group, dipped seven points in January largely on a decline in the barometer’s Index of Future Expectations. That index has dropped about 19% since October while a similar measurement of current conditions has risen about 12% in the same time period. “The ongoing strength in the Current Conditions Index appears to be driven by the ongoing rally in crop prices, while the deterioration in the Futures Expectations Index seems to be motivated by longer-run concerns about policies that could impact U.S. agriculture in the future,” said Jim Mintert of Purdue University’s Center for Commercial Agriculture.  

Earlier this month Kansas Corn STEM launched a new public library program, aiming to provide Kansas public libraries with new resources based on the book, We Grow Corn! Raising Corn on a Kansas Family Farm. The series follows the book, with six units focusing on growing corn and its many uses. Kansas Corn STEM is supported by Kansas corn farmers through the Kansas Corn Commission. Over the past five years, Kansas Corn STEM has been providing free supplies and training to K-12 teachers. While the “We Grow Corn!” book is being used by K-12 teachers, this series was created specifically for public libraries, making it different than what students would see in the classroom. “The Kansas Corn STEM education team strives to create new programs to help educators. We are excited to expand our efforts beyond the K-12 classroom to the community via public libraries,” said Sharon Thielen, Ph.D. director of education, Kansas Corn. More information available at www.wegrowcorn.com.

People

Ford B. West, 73, of Davidsonville, Maryland, died on Feb. 14 after fighting a courageous 15-year battle with metastatic, castrate resistant, prostate cancer. A veteran of the Vietnam War, he attended North Carolina State University where he earned a Master of Science in Food Science. He began his professional career with the National Canners Association and in 1979, he joined The Fertilizer Institute, later becoming president in 2005. West was with the Fertilizer Institute for 34 years.

Mike Rohlfsen has been promoted to chief commercial officer at TechAccel LLC. Rohlfsen brings deep international agribusiness, agtech, and entrepreneurial expertise to new the role. Prior to joining TechAccel, Rohlfsen served 18 years with Cargill Inc., in a variety of financial, strategic marketing, product and business development positions. Most recently, he founded and led Somaris Global, a Minneapolis-based business development firm working in next-generation agriculture technology. His career has consistently focused on applying new technology spanning the aquaculture and organic food supply chains, sustainable biomass product development and precision agriculture.

TechAccel LLC also promoted Jeff Inman to principal. Inman joined the TechAccel as an Associate on the investments team in January 2020, providing support to business development and due diligence of emerging opportunities. In his new role, he will add deal sourcing, focused areas of strategic relationship outreach, and analysis in valuation and modeling.

Brian Sikes has been named chief operating officer of Cargill. He previously led the company’s global protein and salt enterprise. As part of his new role, Sikes will also serve as a management director on the Cargill board of directors. Sikes joined Cargill in 1991 and has held leadership positions in the protein business in the United States, Canada and Europe. He spent four years leading the protein business in North America, based in Wichita, Kansas. Under his leadership, Sikes drove the global expansion of Cargill’s protein offerings, which include beef, poultry, eggs, seafood, value-add and specialty products, as well as plant-based options and investments in cell-based protein technologies. Sikes is a graduate of Texas Tech University. He is on the executive board of the Greater Wichita Partnership, a hub of collaboration between the public and private sectors.

Bayer has elevated two seasoned leaders and accomplished scientists to the key roles of president of Crop Science North America and head of The Climate Corporation and Digital Farming. Dr. Jacqueline Applegate will assume her new role at Crop Science March 1. Dr. Jeremy Williams will assume his new responsibilities at Climate on March 15. Both will continue to be based in St. Louis. Applegate, who will also join the global Crop Science Executive Leadership Team, will be responsible for the commercial performance of the Crop Science Division in the United States and Canada, including the consumer Roundup business. Williams, who will also join the global Crop Science Executive Leadership Team, will lead Bayer’s digital farming strategy and data science capabilities globally.

Kansas Farm Bureau has hired Joel Leftwich as chief strategy officer, effective March 1. Leftwich most recently served as executive director of the William L. Hudson BVI Workforce Innovation Center, which helps train and employ individuals with visual impairments. Before that, Leftwich spent nearly 20 years in D.C. in various roles. He worked on Capitol Hill as a legislative aide to former Rep. Jim Ryun, R-Kansas., was a longtime staffer for former Sen. Pat Roberts, leading to eventually working as the staff director for the Senate Ag Committee. He also held roles with PepsiCo and DuPont, and was a managing director for the Glover Park Group. Source: Agri-Pulse Communications

Chance Hunley has left the Senate Ag Committee and now serves as a legislative assistant to Rep. Jake LaTurner, R-Kansas. He covers the portfolio for agriculture, natural resources, energy, environment, transportation, immigration, and technology. On the Senate Ag Committee, he was a legislative assistant to former Sen. Pat Roberts, R-Kansas., and covered commodities, crop insurance, conservation, food safety, and livestock issues.

Dustin Johansen, Vice Chairman of the Agricultural Business Council of Kansas City has joined Farm Journal’s national livestock and crop sales to help clients integrate data, research and activation capabilities into marketing strategies. He was previously vice president, ag business development at Osborn Barr Paramore. He is also vice chair of the MoKan NAMA chapter.

Farm Journal has announced several other new hires and promotions at its Lenexa, Kansas, offices: Rebecca Bartels, director of business development, Trust In Food; Emma Bruno, digital and data marketing specialist Jason Hill, senior ad operations specialist; Todd Rowan, sales representative; Nicole Starr, national accounts manager, livestock; Danny White, sales representative, Machinery Pete.

NCBA has tapped Kansas cattle producer Jerry Bohn as its new president. Bohn is a retired lieutenant colonel in the U.S. Army Reserve and has been a part of the cattle industry his entire life. He has also served 34 years as the manager of Pratt Feeders, a commercial cattle feeding operation in Kansas. Don Schiefelbein of Minnesota was named president-elect, and Todd Wilkinson of South Dakota was elected vice president

The House Agriculture Committee is getting seven new Republican members, who represent some of the most productive farming regions in the country. Democrats have yet to release their full roster of committee members, but House Speaker Nancy Pelosi announced late Tuesday that Rep. Jimmy Panetta, D-Calif., would be on the panel again for this Congress. Rep. Tracey Mann, R-Kansas, replaces Sen. Roger Marshall, R-Kansas, who ran for the Senate seat vacated by the retirement of former Senate Ag Committee Chair Pat Roberts. Mann is a former Kansas lieutenant governor and holds a degree in agricultural economics. 

Missouri Corn Growers Association elevated Bradley Schad to chief executive officer, effective March 15. Schad succeeds Gary Marshall, who is retiring after leading the state’s corn industry group for 34 years. Schad currently serves as the senior director of market development and grower engagement. He started with Missouri Corn in 2008, managing programs focused on ethanol and other market opportunities.

Events

Kansas Department of Agriculture reminds Kansans that the month of March has been proclaimed Kansas Agriculture Month. In addition Tuesday, March 23, 2021 has been declared Kansas Agriculture Day.  KDA notes:“Kansas has a history deeply rooted in farming and ranching. That tradition lives strong today as agriculture remains our state’s largest economic driver. Farmers and ranchers in your communities go to work each day to grow the food, fiber and energy that sustains each of us. Agribusinesses that line your main streets deliver critical support to this important sector in Kansas. The Kansas agricultural community is leading the way in a dynamic, complex and growing agriculture industry.”

Registration is open for the 2021 Pork Industry Forum. All pork producers and media are invited to attend the virtual Pork Act Delegate Session being held on Wednesday, March 3, from 2-5 p.m. CST. All attendees must register to attend the session at www.porkindustryforum.com.  Pork producers and media are also invited to register for the March Pork Producer Webinar with featured speaker Mohanbir Sawhney on March 2 at 3 p.m. CST. Sawhney has written seven management books as well as dozens of articles in leading academic journals and publications. Sawhney consults many Fortune 500 businesses, including John Deere, Cisco, Facebook, McDonald’s, Microsoft, and Unilever.

The KC Animal Health Corridor is now accepting applications from early-stage companies to present at the 13th annual Animal Health Summit, held virtually August 24-26, 2021. The Summit is one of the only opportunities in the world for early-stage companies in the animal health and nutrition sectors to present their vision, business plan and technology to potential investors. The selection committee will consider companies that meet the following criteria:

• Seeking $500,000 - $20 million in funding, or strategic partnerships to advance a company’s technology.

• Revenue projections of $20 million within 5-7 years

Applications are due April 5. To apply to present as an emerging company, visit the Animal Health Summit application page . For more information, contact Kimberly Young at young@thinkkc.com.

Ag Innovation Forum: Using the Tools We Have

KANSAS CITY, Mo. (February 18, 2021) – Keynote speaker Carl Casale opened the Council’s 2021 Ag Innovation Forum on an optimistic note with an offbeat message. Casale, a fourth-generation farmer with a twenty-six-year career at Monsanto Company and seven-year stint as CEO of CHS, Inc., and currently a senior agricultural partner at Ospraie Management, LLC, said the agriculture industry needs “to use the tools we already have.” He noted that investment should be directed toward production systems and processes and improving existing tools and technology.  COVID-19 has crafted a new lens through which the world views food production.  A shrinking world population has plenty to eat. The challenge he said is how to produce, process and distribute calories and protein in a way consumers want them. He is positive about entering the post COVID-19 era: “Where there is change, there is opportunity.”

In the Forum’s closing keynote address, John Niemann, president, Protein Ingredients & International Cargill Meat Solutions, said Cargill has doubled down on its message about protein: “For Cargill, protein is about more than nutrition; protein has purpose.”  That theme, Niemann explained, is designed to enable the company to create new skills and capabilities and to exceed expectations of its customers. He illustrated these points noting that consumers didn’t ask Apple to develop its iPhone. They never saw it coming, and now they can’t see how they can live without it. Niemann summed up his remarks saying, “Agriculture is bigger than the farm – it is leveraging technology to improve safety, quality and efficiency with automation, analytics, and digital tools.”

This year’s Innovation Forum featured four panel discussions: Promising Projects in the Pipeline; New to Market Technology; Financing New Initiatives; Searching for Long-Term Solutions.

Promising Projects in the Pipeline 
Nikki Hall, Corteva Agriscience, moderator

• Dr. Bob Hutkins, professor of Food Science & Technology, University of Nebraska, described partnering with companies that produce and sell advanced probiotics and prebiotics. He noted 60% of Americans complain of gastrointestinal issues. At $136 billion a year, digestive healthcare costs, are higher than heart disease.

• Kevin Kimle, director of Agricultural Entrepreneurship Initiative, Iowa State University, talked about creating an investment fund in a university setting for ag startups.

• Dr. Jared Decker, associate professor of Animal Science & Wurdack Chair of Animal Genomics, University of Missouri, said in the age of genomics, phenotyping is key. “We don’t need more data, we need more of the right data.” 

New to Market Technology
Gary Wheeler, Missouri Soybean Association, moderator

• Matt Crisp, CEO, Benson Hill, focused “on empowering breeders, farmers, ingredient and food manufacturers, retailers and consumers to develop a better food system from plant to plate.”

• Karsten Temme, CEO & Co-Founder, PivotBio, detailed how his company makes microbes that allows food crop growers to produce their own nitrogen, replacing nitrogen fertilizer.

• Naeem Zafar, CEO, TeleSense, noted that “the quality of crops never gets better once they are harvested,” which is why his company has developed sensing technology to reduce spoilage in stored grain. 

Financing New Initiatives
Chris Simpson, Polsinelli PC, moderator

• Renee Vassilos, director of Agriculture Innovation, The Nature Conservancy, said her group was seeing a lot of new players that want to invest in the agriculture space, citing such giants as Microsoft and Google, as well as industry incumbents like John Deere and Syngenta. She added ag needs new tools and innovation to get to where it needs to be.

• Kerryann Kocher, CEO, Vytelle, called it a “rapid explosion of companies” looking at agriculture as an opportunity to invest. She noted an inflow of “coastal money” into the farm belt and described coastal investors as “experienced and serious” about the ag business.  

• Spencer Stensrude, executive director, Ag Ventures Alliance, mentioned that ag tech does not have enough dollars coming into the space, and the money that does come takes its time. Established farming operations and tech innovators resent having to spend up to half a year away from businesses to court investors.  He stressed the ag industry needs a bigger population of investment groups willing to bid against others to partner with ag tech developers. “That’ll move investors to move quickly to a close.”   

Sustainability
Gardner Hatch, Woodruff, moderator

• David Darr, senior vice president, sustainability officer, Dairy Farmers of America, described DFA’s sustainability goals: 30% greenhouse gas reduction through the science-based target initiatives by 2030; committed to industry-wide goals for the U.S. dairy industry to be net zero on greenhouse gas emissions by 2050.

• Dr. Jason Clay, senior vice president- markets, World Wildlife Fund, warned that “whatever is sustainable today, won’t be tomorrow.” The challenge for farmers is to produce more with less land, less water and less pollution. He remarked that agriculture has to tell a better story of its achievements so far in improving sustainability. He pointed out that positive actions like regenerative agriculture have to be more than a practice; it has to have results.

TechAccel was lead sponsor of this year’s Ag Innovation Forum, and two of its executives presided over the event as masters of ceremonies. Tony Simpson, head of business development, welcomed attendees hinting that the Forum would offer a look at what the Post COVID-19 era would look like.  Simpson said the need for good technology and innovation to feed and care for both people and animals has never been more important. “It is incumbent on us in the ag industry to band together like this,” he said, “to talk about new technology so we can stay on the cutting edge of innovation.”

TechAccel’s chief commercial officer Mike Rohlfsen opened the afternoon session on financing and investment, remarking about how bifurcated the world has become overall, but specifically in how people decide what they want to purchase and what they want to eat. The “haves” can afford to consume food via all sorts of production methods, preparation, packaging and so forth – and these preferences can drive innovation. “However,” he said, “half the world simply wants to have more to eat and have a better mix of calories.” The ag industry needs to take into account all of these factors as it goes forward in advancing technology. Rohlfsen suggested that relying on models that look too far into the future can be daunting to the point of creating panic that could stifle ingenuity. But not for long. He stressed: “I never bet against ingenuity.” 

Ag Looks Ahead at Key Legal Issues

(L to R) Eric Lausten, Curt Blades, Andrea Sellers

As more details emerge about how President Biden will handle regulations that were loosened while Trump occupied the White House, Bob Thompson, partner at Bryan Cave Leighton Paisner, moderated a discussion with three legal specialists who began to unpack some of the implications re-regulation might have in store for the ag industry.  The Council’s annual legal update was sponsored by Bryan Cave Leighton Paisner and featured Eric Lausten, principal, Husch Blackwell Strategies, Curt Blades, senior VP for agriculture and forestry at the Association of Equipment Manufacturers, and Andrea Sellers, co-chair agribusiness at Stinson law firm. 

AEM’s Blades said farmers have always had and will continue to have the ability to repair their own equipment. “Equipment manufactures stand solid in their support of a farmer’s right to repair their equipment [but] stand equally opposed to the modification of equipment that could impact safety, regulatory compliance or infringe on intellectual property.” The scope of the legislation, he pointed out,  is typically broad and covers personal and business technology devices, home appliances, medical equipment, heavy off-highway equipment, boats, snowmobiles, ATVs, and more.

AEM is opposed to new “Right to Repair” legislation, Blades explained, because it is unnecessary legislation. It’s AEM’s position that it puts farmer safety at risk, provide avenues to bypass regulation, disregards aspects of intellectual property, and could make farmers unknowing pawns in a larger digital special interest agenda. The issue is complex. More information is available from AEM and the Equipment Dealers Association.

Andrea Sellers focused her remarks on intellectual property rights applicable to seed, contracts relating to R&D and contracts relating to use and distribution. She noted that “protectable innovations” included GMO plants, plants produced by traditional breeding techniques and germplasm with restricted access. Sellers said disputes over IP rights often emerge over raw data when ‘payers’ claim rights to innovation breakthroughs because of their investment or sponsorship. They don’t – so innovation and investment parties have to work out arrangements going into the research and development.

In his “Transition 2021,” Eric Lausten, principal for Husch Blackwell Strategies based in Washington, D.C., provided an extensive analysis of the political impact the Biden administration will likely have on agricultural policy.  He said the president will seek a centrist approach and bipartisanship where possible. “But recent events and each party’s vocal wings are apt to disrupt.” Lausten pointed out that USDA Secretary Vilsack’s appointment could be a sore spot for the progressive Democrats who see Sec. Vilsack as maybe too close to corporate agriculture.  On the other hand “rural economic development is a priority for House Dem Whip (and kingmaker) Jim Clyburn.”

Lausten’s presentation is thorough, exhaustive and enlightening. Copies of his presentation are available from the Council. Contact Erica Venancio for further information.

Latest News & Updates in KC Agriculture - January 2021

Developments 

The Kansas City Chiefs will be back to defend its Super Bowl title, QB Patrick Mahomes will be there to electrify football fans whether they’re cheering for him or rooting for his opponent. And future Hall-of-Famer Tom Brady will be playing in his tenth Super Bowl Championship game.  But something will be missing. For the first time in 37 years Budweiser won’t be advertising, and the iconic Clydesdales reportedly won’t be the stars of a heartwarming, inspiring short film. Instead, the beer company is allocating money it would have spent on a commercial (worth some $5.6 million per spot) to support Covid-19 vaccine awareness.  However, just because the Budweiser brand will be sitting on the bench doesn’t mean its Belgium-based parent Anheuser-Busch InBev will be on the sidelines, too. AB InBev, which has exclusive advertising rights to Super Bowl’s alcohol category will still be pitching its other products: Bud Light, Bud Light Seltzer Lemonade, Michelob Ultra and Michelob Ultra Organic Seltzer.

Meanwhile Chipotle Mexican Grill will run its first-ever Super Bowl ad this year to highlight the farming practices of its suppliers. During the pandemic Chipotle has been one of the rare successes from the restaurant industry. The burrito chain has seen its digital sales more than triple in its last two quarters, and its stock has soared 72% in the last year, raising its market value to $41.9 billion. Chipotle’s ad aims to keep customers coming back to its restaurants by focusing on its “food with integrity” pledge and how it sources its ingredients. In the commercial, a boy asks if a burrito can change the world, from emitting less carbon to making farmers happier, while showing images of peppers and tomatoes being grown, picked and transported.

FCS Financial’s board of directors has announced the cooperative is returning more than $30.7 million to their member-owners in cash patronage for the 2020 calendar year. CEO David Janish, noted the organization had a strong year in 2020 and its patronage program allowed it to share that success with its member-owners. Since 2006, FCS Financial has returned nearly $180 million to member-owners. 

A new report from the American Farm Bureau Federation provides an in-depth examination into the USDA-National Agricultural Statistics Service’s (NASS) survey collection and data reporting issues. It also provides recommendations to improve accuracy and farmer confidence in the survey results. Read the full document at AFBF USDA-NASS Working Group Report.

A new USDA report analyzing data from the 2017 Census of Agriculture Typology shows family farms comprise 96% of all U.S. farms, account for 87% of land in farms and have an 82% stake in the value of all agriculture sold. Data show that small family farms, those farms with a Gross Cash Farm Income (GCFI) of less than $350,000 per year, account for 88% of all U.S. farms, 46% of total land in farms and 19% of the value of all agricultural products sold. Large-scale family farms (GCFI of $1 million or more) make up less than 3% of all U.S. farms but produce 43% of the value of all agricultural products. Mid-size farms (GCFI between $350,000 and $999,999) are 5% of U.S. farms and produce 20% of the value of all agricultural products. Source: USDA National Agricultural Statistics Service (NASS); www.nass.gov

In a survey conducted among its weekly newsletter subscribers earlier this month, Brakke Consulting, Inc., found that most animal health companies had a positive outlook going into 2021.  Eighty-six (86) percent of respondents felt their business would increase by more than 5%, the sort of average industry growth rate occurring over the last five years. But 41% indicated their business would increase 10-19%, and a healthy 13% responded that they expect a business increase next year of 20% or more.

Merck Animal Health has announced that Bovilis Nasalgen 3-PMH is now available to veterinarians and cattle producers to protect beef and dairy cattle from five of the most common pneumonia-causing viral and bacterial pathogens: infectious bovine rhinotracheitis (IBR), bovine respiratory syncytial virus (BRSV), parainfluenza 3 (PI3), Mannheimia haemolytica and Pasteurella multocida. (company press release)

Nextgen Cattle Company and its partners this month launched operations at its 100,000-square-foot beef processing plant, Missouri Prime Beef Packers. The facility was previously operated as a pork processing plant under the name Moon Ridge Foods. The company said the facility is undergoing upgrades and modifications for both fed and non-fed beef cattle. Missouri Prime Beef Packers expects to process 500 head of cattle per day. 

The winner of the 2021 AFBF Farm Dog of the Year award is an Australian Shepherd owned by New York Farm Bureau member Sonja Galley. The American Farm Bureau Federation, with support from Nestlé Purina PetCare, recognized the Aussie at its Virtual Convention earlier this month. (Editor’s Note/Full Disclosure: Our family has enjoyed the companionship, intelligence and industriousness of our Aussie, Fitzpatrick, for over a dozen years. OooRah!)  

Farmer sentiment improved modestly in December as the Ag Economy Barometer rose to a reading of 174, up 7 points from November. December’s sentiment improvement still left the barometer 9 points lower than in October. The Purdue University Ag Economy Barometer is a nationwide measure of the health of the U.S. agricultural economy.

USDA’s Export Sales Report for the week ending January 7, 2021 showed strong numbers for corn and soybeans.Allendale commodities broker Greg McBride said it was a bullish week for grains with 1.437 million metric tons of corn and 1.234 million mt of soybeans shipped. “We are riding a nice wave here off of this USDA (WASDE) report,” McBride said.  Source:  Iowa Agribusiness Radio Network

2020 Farm equipment sales exceeded 2019 figures across a variety of categories, according to new data from the Association of Equipment Manufacturers. AEM’s Ag Tractor and Combine Report showed tractor sales for the year were up 17.7% over 2019; combine sales had a smaller increase, up 5.5%. “The year 2020 was difficult on a number of fronts. Despite uncertainty in the overall economy, the ag equipment market has been pretty strong,” Curt Blades, AEM’s senior vice president of ag services, said in a statement. “The growth we saw in farm tractors and combines was pleasant news — driven largely by smaller equipment.”   Source: Agri-Pulse Communications.

Did you know? Bill Gates, the fourth richest person in the world, (net worth of $121 billion, according to Forbes) has acquired 242,000 acres of farmland across the U.S., enough to make him the top private farmland owner in America. The Land Report says Gates has built up a massive farmland portfolio spanning 18 states. His largest holdings are in Louisiana (69,071 acres), Arkansas (47,927 acres) and Nebraska (20,588 acres). Additionally, he has a stake in 25,750 acres of transitional land on the west side of Phoenix, Arizona, which is being developed as a new suburb. The Land Report notes the acreage is held directly and through third-party entities by Cascade Investments, Gates’ personal investment vehicle. 

At the outset of 2021, the Missouri Department of Agriculture issued a list of key accomplishments in 2020:

• The Missouri General Assembly appropriated $20 million in federal CARES ACT funding for the Department to create the Missouri Meat and Poultry Processing Grant Program. 

• The Missouri Grown program sold and distributed more than 450 holiday gift boxes to more than 34 states across the country.

• The Missouri Industrial Hemp State Plan was approved by the USDA.

• The Missouri State Fair Youth Livestock Show saw a 12% increase in 4-H and FFA livestock entries.

• The State Milk Board inspected an additional 320 dairy farms.

• The Grain Inspection Services team designed and created a workstation shield, allowing their employees to continue working safely during the COVID-19 pandemic. 

• The Meat Inspection Team worked with processors throughout the state to accommodate flexible inspection schedules, helping ensure continuity of business.

• The Plant Industries division took in more than 1,200 reports of unsolicited mystery seeds in Missouri and helped coordinate with the USDA.

Major beef packer Cargill has announced a pair of upcoming facility shutdowns, but not due to the coronavirus pandemic. Cargill plans to temporarily idle its Dodge City, Kansas., and Schuyler, Nebraska., facilities for scheduled maintenance on refrigeration systems. Both plants will be shut down for about a week; the Dodge City maintenance is scheduled to begin Feb. 4, the work in Schuyler will start March 18. Source: Agri-Pulse Communications, January 27, 2021.

People

TechAccel LLC, a Kansas City- Missouri-based private venture development organization investing in scientific breakthroughs to help solve the global food crisis, has announced Tina Youngblood, Ph.D., has joined the company as Chief Finance & Administrative Officer. Dr. Youngblood comes to TechAccel from Pathfinder Health Innovations, a software startup in Kansas City, where she served as CEO. She has also served as CEO at Spencer Re and Cunningham Lindsey; earlier she spent 10 years in a variety of global leadership positions with Zurich Insurance Group, including as chief of staff to the chief administrative officer of the corporate center in Zurich, Switzerland, as well as CAO of the North American division in Chicago.  In addition to Dr. Youngblood’s leadership roles in finance, equity and risk management, she brings experience as a tenured associate professor of accounting at Miami University in Oxford, Ohio. She received undergraduate and master’s degrees from Tennessee Technological University and a Ph.D. in accounting with a minor in cognitive psychology from the University of Tennessee. 

Everett Hoekstra retired as president of Boehringer Ingelheim Animal Health USA and has been succeeded by Randolph Legg. Legg will remain head of the company’s U.S. commercial business while serving as president. The company has also appointed Helmut Finkler as head of Regional Bio Manufacturing Americas and global manufacturing science and technology. He will oversee vaccine-production sites in the Americas. Finkler most recently served as head of global bio operations in global operations animal health.

Kevin Knoth is the new communications director for Missouri U.S. Rep. Vicky Hartzler. Most recently Knoth served in North Carolina’s U.S. Rep. Mark Walker’s office as communications director. 

Trey Forsyth has joined Michael Torrey Associates as director of government affairs, after serving as a policy adviser to chief agricultural negotiator Gregg Doud at the Office of the U.S. Trade Representative.

Osborn Barr Paramore president Rhonda Ries has been accepted into the Forbes Agency Council, an invitation-only group for owners and executives of successful public relations, media strategy, creative and advertising agencies. She was selected by a review committee based on the depth and diversity of her experience. Criteria for acceptance include a track record of successfully impacting business growth. 

USDA has named individuals who will hold senior staff positions in Washington, D.C. during the Biden Administration: Katharine Ferguson is the new Chief of Staff in the Office of the Secretary. Most recently, Ferguson served as Associate Director of the Aspen Institute Community Strategies Group. Before joining the Aspen Institute, Ferguson served in the Obama Administration as Chief of Staff for the White House Domestic Policy Council and as Chief of Staff for Rural Development at USDA. Robert Bonnie will be Deputy Chief of Staff for Policy and Senior Advisor, Climate. Most recently Bonnie served as an executive in residence at the Nicholas Institute for Environmental Policy Solutions at Duke University. Previously, he served as Director of the Farm and Forests Carbon Solutions Initiative at the Bipartisan Policy Center, where worked to develop new initiatives to combat the climate crisis through agricultural innovation. Sara Bleich, PhD, is Senior Advisor. Previously, Bleich served as a Professor of Public Health Policy at the Harvard T.H. Chan School of Public Health. Her research centers on food insecurity, as well as racial injustice within the social safety net. 

The Republican Steering Committee has announced new GOP members on the House Agriculture Committee. They include Rep. Michelle Fischbach, R-Minn.; Rep. Tracey Mann, R-Kan.; Rep. Randy Feenstra, R-Iowa; Rep. Michael Cloud, R-Texas; Rep. Kat Cammack, R-Fla.; Rep. Barry Moore, R-Ala.; and Rep. Mary Miller, R-Ill. 

Kansas’ newly elected U.S. Congressman Tracey Mann has named additional members of his D.C. staff. Laura Schlapp is Mann’s communication director. She previously worked at the Department of Defense and most recently served as regional media director for Vice President Mike Pence. Katherine Thomas is the new deputy legislative director. She previously worked on agriculture issues for former Sen. Pat Roberts, both as a legislative assistant on the Senate Ag Committee and as senior agriculture policy adviser in his personal office.  Source: Agri-Pulse Communications, January 27, 2021.

Events

All Pork Producers, Industry enthusiasts and Allied industries are invited to attend The Missouri Pork EXPO scheduled for February 2-3 at Margaritaville at the Lake of the Ozarks.  The complete EXPO Brochure, registration and Trade Show information are available at  www.MoPork.com. There will be 102 Trade Show exhibitors. Governor Mike Parson will address attendees at the banquet on Feb 2, and political analyst, Jim Wiesemeyer, with Informa Economics, will speak at the Leadership Breakfast, Feb 3. Missouri State Senator Caleb Rowden will be receiving the Outstanding Legislator award and MU Professor, Tim Safranski will be receiving the prestigious Chairman’s Award.

An opportunity is available for college students wanting to attend the 2021 Cattle Industry Convention and NCBA Trade Show in Nashville, Tennessee, August 10-13, 2021.  A team of interns – vital to the success of the largest annual meeting in the U.S. beef cattle industry – will gain first-hand experience and be able to interact with leaders of every segment of the cattle and beef industry. Up to 18 interns will be selected for this opportunity. Interested students must complete a student internship application by April 15, 2021. More information at www.ncba.org. 

National Cattlemen’s Beef Association is hosting a two-day virtual event for cattlemen and women across the country to get updated on industry, trends and developments. The 2021 Cattle Industry Convention Winter Reboot, scheduled for February 23-24, is an opportunity to connect with NCBA and serves as a kickoff event for the Cattle Industry Convention & NCBA Trade Show that will take place August 10-12 in Nashville, Tenn., at the Gaylord Opryland Resort and Convention Center. Winter Reboot attendees will receive a sneak peek into plans for the Cattle Industry Convention and the Cattlemen’s College. Register for the Winter Reboot here.

The Kansas Department of Agriculture and K-State Research and Extension will offer virtual workshops February 16 - 19, 2021, to assist farmers’ market vendors and managers, as well as those wanting to sell food products directly to consumers. The workshop series includes three online Lunch and Learn sessions, followed by a half-day virtual workshop. Registration for the February virtual workshops is now open. The cost is $5 per participant. Register here.

The Animal Agriculture Alliance (AAA) has made available to the public its session recordings from the first-ever Virtual Stakeholders Summit. The 2020 Virtual Summit, themed “Primed & Prepared,” focused on equipping food and agriculture stakeholders with the tools needed to bridge the gap between farm and fork. Session recordings from the 2020 Virtual Summit are available here. Condensed overview of insights shared at the event is available here.

The Animal Agriculture Alliance has announced its 2021 Virtual Summit “Obstacles to Opportunities” will take place May 5-6. Registration for the 2021 Virtual Summit opens February 1. For more information about the Virtual Summit, visit animalagalliance.org/initiatives/stakeholders-summit/.

Kansas State Conservation Commission will hold its regular meeting on Monday, February 1, 2021, at 10:00 a.m. using a virtual attendance format. The agenda will include a discussion of long-term planning objectives as well as updates on funding and technical assistance opportunities. The SCC consists of five elected commissioners; two ex officio members representing the Kansas State University Agriculture Experiment Station and Cooperative Extension Service; and two appointed members representing the Kansas Department of Agriculture and the USDA’s Natural Resources Conservation Service. More information about the online meeting is available at KDA–DOC at 785-564-6620 or kda.doc@ks.gov.

At 2 p.m. Tuesday, Feb. 2, University of Missouri Extension will host a free webinar on climate change. MU Extension horticulture specialist Robert Balek and Thomas W. Blaine, Ph.D., associate extension professor at Ohio State University, will present an overview of climate change in Missouri and the economic impact it can have on agriculture. Also included in the presentation is a discussion of how the climate is currently changing in Missouri and what the next few decades are likely to bring, with a special focus on agriculture. Hosting the presentation on behalf of MU Extension Labor and Workforce Development are Amy Patillo and Matt Pezold. For more information, contact Ms. Patillo at patilloa@missouri.edu.  

Digging Deeper...

This photo, posted by the Council Bluffs (Iowa) Police Department in June 2019, shows Missouri River floodwaters looking north from the Interstate 29 interchange with I-680 north of Council Bluffs.

Council Bluffs (Iowa) Police Department

A year ago, in the December 2019 edition of the Council newsletter, the focus of the Digging Deeper column was the U.S. Army Corps of Engineers’ lack of emphasis on flood control in the omnibus Endangered Species Act of 1973 that over the years shifted priorities away from mitigating often ruinous flooding to protecting endangered wildlife. At the same time a year ago, Missouri congressional representatives and senators were working on legislation – the omnibus Water Resource Development Act that is reviewed biennially – that would ensure farmers are participants in any USACE decision-making that directly impacts their farms and communities. Specifically, U.S. Representative Sam Graves’ House Act makes flood control the overarching and number one priority in the Corps’ Master Manual. 

By Dennis McLaughlin, McLaughlin Writers LLC.

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Missouri River Regions Looking At Improved Flood Control

Last month, more than a year after farms and communities along the Missouri River were finally recovering from disastrous spring flooding in 2019, it seems that earnest action has been taken to prevent or at least mitigate flood damage. Authorization of the Water Resources Development Act (WRDA) of 2020 – introduced by U.S. Representative Sam Graves, Ranking Member of the House Committee on Transportation and Infrastructure – is critical for flood control, navigation, ports, locks, dams and other water resources infrastructure.  

“Ensuring that timely flood control and navigation improvements continue to occur is a centerpiece of this bill,” said Ranking Member Graves.  “Lives and livelihoods depend on the important reforms in WRDA and I am proud to cosponsor this bipartisan bill so we can help reduce the disastrous flooding we’ve seen over the years and improve the navigability of our rivers. This bill is the product of a bipartisan effort and it’s the perfect example of the way things should work around here.”

The final bill contains many important provisions to North Missouri: 

• Expanding work on a Lower Missouri River Basin Flood Risk and Resiliency Plan

• Expedited completion of maintenance

• Repair activities for Federally operated and maintained levee systems in the Lower Missouri River Basin,

• Changes to the non-federal levee program to enhance flood protection, further prohibition of Interception-Rearing Complex’s (IRC’s), 

• Changes to the Inland Waterways Trust Fund cost-share which would help make repairs and upgrades to locks and dams on the Mississippi River,

• Continuation of work on the Upper Mississippi River Comprehensive Plan, along with several other provisions critical to flood control and navigation. 

Some Work Underway

According to USACE’s Omaha District, significant strides have been made in repairing over 350 miles of levees across the Lower Missouri River Basin that were damaged following the historic floods of 2019.  But a heightened level of flood risk remains for the communities and landowners behind these damaged levee systems as repair efforts remain ongoing. This risk is higher than it was prior to the 2019 flood because the levees were compromised, said a district spokesperson. “Until all of component of the system, such as seepage berms and relief wells are repaired, the system does not fully provide the same level of flood risk reduction as it did in its pre-flood condition.”

A lot of work has been done by the levee sponsors, other stakeholders, and USACE team to repair the levee systems that were decimated by the 2019 flooding. However, there is still a significant amount of work to be done. “The levees in their current conditions do not offer the same level of risk reduction as they did prior to the 2019 floods,” warned Matt Krajewski, Director of Emergency Operations, USACE-Omaha. “There is still work to be done up and down the system to restore the levees to their full protection level. I urge everyone to remain vigilant this upcoming flood season.”

To date, USACE has allocated nearly $500 million toward levee repair construction contracts, and more than $375 million of the work has been accomplished, including 15 projects that have been substantially completed, 12 that are currently under active construction and five projects that are still working through the design process. All levee systems ae expected to be at full height by March 1, 2021; and repairs on various other components of the levee systems will continue throughout much of the 2021 construction season. “Until these repairs can be completed the USACE, levee sponsor and local communities need to remain vigilant,” USACE Omaha said. 

The Omaha District remains focused on ensuring the safety of citizens and remain positioned to provide flood fight assistance to state, local and tribal government agencies, as appropriate. It will also continue working with other federal partners to communicate the conditions on the river systems as the 2021 run-off season gets underway.  When severe weather and/or heavy precipitation is forecast, the public is encouraged to keep in contact with their local emergency managers for the latest conditions in their area.

“WRDA 2020 makes it a priority to secure, upgrade and improve our non-federal levees,” said Rep. Graves in a statement.  “After all, these levees protect countless small towns, and every levee is important to our flood control efforts because it only takes one weak link for things to turn south in a hurry.”

It will help upgrade locks and dams on the Mississippi River that are so critical to shipping our products across the country, he noted. The legislation builds on existing efforts to revamp flood control plans on the Missouri and Mississippi rivers and speeds up the repair of federal levees damaged in 2019. For those areas that have seen repetitive flooding, Rep. Graves added, there will be new opportunities to upgrade infrastructure to reduce the risk of future flooding.

“This bill doesn’t fix everything, but WRDA 2020 does place a focus on improving flood control and navigation, which is critical. People’s lives and livelihoods are the top priority in my book. Our laws, regulations, and the management of our rivers should reflect that.” 

Source: U.S. Army Corps of Engineers, Omaha District; Omaha District’s System Restoration web page.

Flood Prognosis 2021

The risk for flooding along the Missouri River appears lower than normal headed into the 2021 flood season, according to officials with the U.S. Army Corps of Engineers and the National Weather Service. The ground remains dry across most of the region and snowpack levels are generally below average, says the Corps and the NWS. But they caution it is still early in the year, and conditions could change. Current data indicate 2021 will be drier with only about 90% of the normal amount of water expected to flow down the Missouri.

Despite the vagaries of weather, USACE has solid engineering data backing up its optimism about a floodless spring:

• Full flood control capacity on the Missouri River Mainstem Reservoir System is available for the 2021 runoff season.

• "All 2020 flood water stored in the annual flood control zone has been evacuated as of Dec. 21, 2020" said John Remus, chief of the USACE Missouri River Basin Water Management Division.

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Key Change In WRDA 

The Water Resources Development Act of 2020 includes major changes in the way projects are funded, which could accelerate reconstruction of locks and dams and other waterway projects, Agri-Pulse reported in December. Prior to the new legislation, half the funding for projects came from the Inland Waterways Trust Fund, which depends on revenue from barge fuel taxes. The other half comes from the federal Treasury. Under the new bill the Waterways Trust Fund contribution would drop to 35%, while the Treasury would pick up the tab for 65%. “The change would free up roughly $100 million a year in general funds for inland waterway construction projects,” wrote Agri-Pulse(December 16, 2020). 

Changing the cost-share has been a major priority for the Waterways Council, which includes agricultural shippers. Waterways Council President Tracy Zea said the cost-share requirement hasn't been changed since the 1986 water projects bill. “You’re looking at funding three to four projects to completion, additional, with that funding,” he told Agri-Pulse. Zea said the change will expedite the construction timeline of lock and dam infrastructure, including the upper Mississippi River project known as the Navigation and Ecosystem Sustainability Program, which was authorized in 2007. 

The water projects bill also authorizes roughly $9.9 billion in federal funds for 46 reports by the Army Corps of Engineers on navigation, flood risk management, hurricane and storm damage risk reduction, flood risk management, ecosystem restoration and water supply projects. Mike Steenhoek, executive director of the Soy Transportation Coalition, agreed additional funding would expedite work on waterway infrastructure projects, but noted there is always a concern with attaching a “widely bipartisan” bill to a massive omnibus bill that could get hung up on disagreements. “Any time it gets attached to something more controversial it has the opportunity to sink the entire ship and all of those passengers that are on board,” he said.

Source: Agri-Pulse Communications, December 16, 2020.

Digging Deeper...

Despite the upheaval COVID-19 dumped on every sector of the U.S. economy and every aspect of our society and culture, it seems the ag industry overall is poised to emerge from 2020 with renewed optimism and momentum. “After declining farm financial outlooks last spring,” noted the University of Missouri’s Food and Agricultural Policy Research Institute earlier this month, “farmer sentiments are skyrocketing.” 

Dennis McLaughlin, McLaughlin Writers LLC, with Ernie Verslues, MFA, Inc., president and CEO; Matt Teagarden, CEO, Kansas Livestock Association; Mark E. Stewart, Ed.D., president and CEO, Agriculture Future of America 

In A Year Of Disruption, Agriculture Shows Its Grit, Spunk, and Value 

When the U.S. economy took a devastating nosedive caused by the COVID-19 pandemic, the agriculture industry rose to new heights in the eyes of Americans. Gallup’s annual assessment of the country’s favorability leanings toward 25 business and industry sectors showed farmers and ranchers were top guns.  Farming and agriculture, already among the highest-rated industries over the years, stepped up to the top position on the medals stand, as Number One with a 69% positive rating according to Gallup.  The grocery industry was silver medalist, likely because of its quick recovery from the pandemic’s initial attack on inventories and supply chains. Restaurant, computer and retail industries, respectively, occupied the other positions in the top five. (More information available at Gallup Poll Social Series:  Americans' Views of U.S. Business and Industry Sectors, 2020. For more information about industry favorability click here.)

At the risk of coming off Pollyannaish or insensitive to the more than 1.5 million deaths globally from COVID-19, it still can be said that agriculture carried itself nobly, pragmatically and effectively during the pandemic. As Americans’ initial fears for their health and safety gave way to day-to-day concerns about putting food on the table, agriculture, food and transportation industries rose to the occasion.

Moderating a webinar discussion on the food supply chain hosted by the Agricultural Business Council of Kansas City in April, Tom Brand, executive director, National Association of Farm Broadcasting, said  consumer jitters over shortages and higher prices for groceries and home goods was misplaced. “Demand is the issue, not supply.” The economic fundamentals of production, inventory, transportation and liquidity were intact across all sectors of the food industry. And remained so as the pandemic crisis deepened.

Speaking to Council members in July, Dr. Dan Thomson, chair of Iowa State University’s Department of Animal Science, stressed that animal agriculture was an essential business. He made a point that COVID-19 forced a streamlining of most animal ag operations and processes, and the ag industry stood up to the challenge.  Distributors and grocery store employees and managers also earned their stripes as essential workers, said Dr. Thomson.

Things Looked Good……

……Until they didn’t. At the outset of 2020 optimism reigned in the ag industry, especially over trade, said Matt Teagarden, CEO, Kansas Livestock Association. Japan had lowered tariffs on beef imports from the U.S. to a level where American protein producers could compete with Australia and other beef producing nations.  In October 2019, China and the U.S. had reached an agreement to implement the first phase of a renegotiated trade agreement. Meat prices at home were higher, also. “People buy beef when the economy is good,” Teagarden noted.

As COVID-19 cases increased, business, education, social organizations and institutions went into lockdown. March’s ‘turn-for-the-worse’ was worse than anticipated. The effect on ag industry plans and operations, as well on the economy in general, was drastic, said Teagarden. “The losses were steep and severe.”  What had been a dynamic economy that was challenging business managers to be nimble enough to keep up with all the fast moving parts, now became, as Teagarden describes it, a challenge to see how quickly the economy could recover.

But first most American businesses readily switched from a focus on first or second quarter financial performance to worker and plant safety. In a March communique to its employees, customers, vendors and distributors, MFA Incorporated stated its first concern was for the security and well-being of its employees and their families and communities.  “Although farmers and the rural communities we live in have a long history of being resilient during such times,” wrote Ernie Verslues, MFA’s president and CEO, last March, “the nature of the coronavirus and how easily it can spread is a very real and serious concern for everyone.”

At that April Council meeting, Dennis Rodenbaugh, executive vice president, Dairy Farmers of America, said the immediate goal of his organization at the outbreak of the Covid-19 pandemic was to create a strategy guaranteeing health and economic security for its member dairy farmers, and opportunity as the country emerges from the crisis. Since the dairy co-op was dubbed an essential business and would remain operational, Rodenbaugh explained that within 48 hours of nation-wide lockdowns, 1,200 of DFA’s 6,000 employees were sent home to work remotely. Farmers, truck drivers and other staffers were provided with PPE gear and sanitizers so they could carry on as safely as possible. “Unfortunately, cows can’t be turned off,” he rued, “and gallons of milk had to be dumped.” Going forward, DFA is implementing and devising as many tools as possible to stabilize the market. To that note, KLA’s Teagarden adds that KLA dairy members are presently operating in a ‘strong’ space.

Shutting down operations was not an option, said Verslues.  Even as the pandemic-caused slowdowns in production and created a backlog of farm supplies, at the end of the day, he said, “We delivered on our value promise” – which meant the  Columbia, Missouri-based regional farm supply and marketing cooperative continued to provide its 45,000 farmer members with quality products and services, as well as wholesale products to agricultural companies. 

The initial impact of COVID-19 disrupted MFA, as it did everyone. But Verslues explained his team adopted a proactive strategy to face the situation head-on. Despite some early, temporary workforce curtailment, MFA was fully staffed onsite and remote by June.  Looking back, Verslues recalled that other obstacles were cropping up in fall 2019 before COVID-19, such as reduced planting in the wake of catastrophic flooding, and prevent planting policy and initiatives. So MFA was already reviewing its processes to react to market and natural disruptors.  “We are always reviewing our processes and contigencies,” Verslues said.

Seaboard Foods’ Kevin Smith, vice president, sales and marketing, said his company had no real playbook for the pandemic or the havoc it raised on an hourly basis. But Seaboard rapidly rolled out a plan focused first and foremost on the well-being of its employees, customers and “society in general.” The blueprint for survival called for curtailing unnecessary travel, customer visits and aligning its safety and business guidelines with CDC policies and recommendations. Seaboard also donated over 30%  of its food products to organizations providing nutritional safety nets for people in need nationally and globally.

Emerging Innovation

In detailing other steps they were taking to mitigate Covid-19 damage to the U.S. economy, all the speakers (Rodenbaugh, Smith and Nick Ebert of Sysco) at the Council’s April meeting said their companies were making special appeals to grocery retailers and food service restaurants and drive-thru outlets.  All three disclosed that part of their outreach included an appeal to retailers to review “limited quantity” purchase policies – underscoring the idea that producers had product, and the issue was not supply, but demand.

Rodenbaugh described a DFA campaign to encourage food service companies to increase use of dairy ingredients by an ounce or two in their portions of ice cream, milk shakes and cheese toppings as way to decrease dairy farmer raw product inventory, and reduce dumping. Rodenbaugh stressed that dealing with retail grocers required a respectful approach in a stressful time. The key, he said, was “to let store managers make stocking decisions while encouraging them to keep up with demand and manage their labor to accomplish that end.”  The supply is available, he emphasized. 

As food service operations were closed and allowed only to serve take-out fare, Kansas City-based Sysco realized its styrofoam containers were not suitable for diners wanting to carry-out traditional full-course family meals.  Nick Ebert, vice president of sales for Sysco, said his company came up with a number of container designs using better materials. Sysco is expanding its food service customer model in the future to reach out to retailer grocers like Albertsons and Kroger. 

The critical lesson from this Covid-19 pandemic, said Seaboard’s Smith, is “as we move toward normalcy, we have to plan for other Covids, and be prepared to pay for them with liquidity, strong P & L’s and strengthened supply chains.” He added it is not easy to predict pandemic outbreaks, but “the economy can be financially prepared using technology and applying what we’ve learned from this one.” 

Or to put it another way:  risk management has to be near the top of the list of any ag enterprise’s strategic plan. KLA is making sure it understands how each of its members does business. “Our members operate their businesses differently, and setting guidelines for risk management can’t necessarily be universal,” said Teagarden, adding that it is difficult to anticipate how to prepare them for natural, financial or biological disasters.”

Going Forward

Farm income is recovering from last spring’s coronavirus-driven declines, say surveys conducted by Kansas City Federal Reserve Bank. “An influx of CFAP government payments and higher prices for agricultural commodities provided greater support for farm finances in the third quarter and seemed to limit demand for financing,” said Kansas City Fed economists Cortney Cowley and Ty Kreitman.

“Although farm income generally remained low, rates of loan repayment stabilized and farmland real estate markets remained strong,” they wrote “The third quarter was the first time in seven years that bankers reported a decline in the credit needs of farm borrowers in all districts.”

Pat Westhoff, director of the University of Missouri’s Food and Agricultural Policy Research Institute recently noted: “This has been a phenomenal year with all sorts of market developments [appearing] every month; we think we've got things figured out; and then the next month, something new happens.”  But after declining farm financial outlooks this spring, farmer sentiments are now climbing, according to Purdue University’s Ag Economic Barometer. It’s director Jim Mintert said, “Since bottoming out in April at a rating of 96, it has been rising pretty consistently, and [in October] it set a new record high at a reading of 183.” 

Agriculture’s situation still is not business as usual, but KLA’s Matt Teagarden suggests the light at the end of the tunnel is getting brighter. The rapid development and introduction of COVID-19 vaccines could lead to a “relatively quick recovery of protein demand.” 

Source: Chuck Abbot, Successful Farming magazine;  Columbia Daily Tribune, Misouri;  Agricultural Business Council of Kansas City, April, 2020, Newsletter; University of Missouri’s Food and Agricultural Policy Research Institute 

2020: From A Different Perspective

From Mark Stewart, President and CEO, AFA

While ag businesses, suppliers, distributors and transporters were hustling to address demand pressures and shore up weak points in their supply chain, another agriculture group of future agricultural industry leaders were exposed to what might turn out to be one of the more unique learning opportunities it will encounter. 

Agriculture Future of America, based in Kansas City, Missouri, provides first class leader and career development experiences for highly motivated young men and women.  AFA programs are built through  partnerships with organizations, individuals, universities, communities and foundations. But just like the rest of the world, AFA had its feet put to the fire when COVID-19 disrupted normal routines and challenged it to adjust to conditions it never anticipated. 

“We did not have any plans to roll out new programs or expand, but we did have plans to introduce new strategies and prepare for our 25th Anniversary,” said Mark Stewart, Ed. D., president and CEO of Agriculture Future of America.  He also noted AFA planned to expand programs to address equality and inclusion principles, and introduce them into AFA’s staff training and development syllabus.

But first things first. AFA immediately adjusted its operations model to get online and go virtual.  “We were able to offer some webinar-style discussions about careers and topical issues for students through our partnership with Merck Animal Health.,” Stewart said. But in July, AFA conducted its first virtual presentations when it went virtual with its Crop Science Institute curriculum. Preparations to join the digital/cyber medium included selecting online program platform technology to house events as well as finding creative ways to engage industry partners with students, he explained. 

With what AFA learned from such events, its staff chose a different online platform to host its Leaders Conference event in November. “We tweaked some processes with our application and selection to ease the experience,” Stewart said, “and we thought creatively about program design since it would be all virtual.”  Ultimately, AFA was able to carry out most of its programs and continue its operations despite the pandemic.  

Lessons Learned 

AFA has seen two silver linings emanate from the pandemic. “One,” Stewart pointed out, “we knew in the  future not all of our of best talent wouldn’t reside in Kansas City.” He added that it wouldn’t make sense for all of the AFA staff to be located together in one place. “Second, we had talked for years about a virtual add-on or complementary element to our in-person experiences.”  Stewart elaborated: “The year 2020 was a catalyst in moving these discussions forward faster, and for that we have much to be grateful for as it has drastically changed our outlook on the future.”  What’s more, Stewart said, AFA is shifting its mindset from weathering the storm to looking for opportunity in it. “We’ve realized just how much we can do. We forged ahead with some critical hires, we went full speed into our next strategic plan with the mindset that this was the greatest opportunity for us to think differently and innovate. Ultimately, we have learned that even in the midst of great disruption, uncertainty or fear, there is great opportunity if met with optimism.”