SE Minnesota farmers have grain to sell

With the current lower commodity prices and no real significant bump in the short-term forecast, careful planning has become more important than ever for farmers to stay in business.

Balancing lower prices for products farmers produce against the fact that input costs to produce those products haven’t come down yet requires more juggling than in recent seasons. Among some of the more significant costs is land rental, which is squeezing the bottom line of renters all over Minnesota and across the country.

Farmers have grain to sell

Lisa Behnken is a crops specialist with the University of Minnesota Extension office in Rochester. (Photo from AgriNews.com)

“Boy, is that a difficult one (to control),” said Lisa Behnken, a Crops Specialist at the University of Minnesota Extension Service in Rochester. “Rents keep going up and it’s very hard to renegotiate to bring those costs back down. It’s certainly a big part of the equation.

The high costs of renting land may lead to some tough business decisions.   Farmers may shuffle some land around, or even let a particular piece of land go back and not rent it anymore.

“We’ll see if people can do that (make things balance out),” Behnken said, “or if they’re going to let land go and back away from it because they can’t afford that. You may see some land changing hands because of the cost.”

With corn and soybean prices in the tank, are there other opportunities farmers may be looking at for profit? What about small grains?

“It all goes back to where their markets are,” Behnken said. “We have a good group with Extension that do workshops on small grains here in southern Minnesota and a good group of core farmers that grow small grains. They’ve got markets that they’re working with and are locked into.”

She added, “It can be successful, but it’s not just something you’re going to jump into. We don’t have the sell-points here. You need to have convenient places where you’re going to market it to. They don’t buy at every single elevator. It doesn’t mean you can’t do it, you just have to get everything in order, from planting it to marketing it.”

Behnken, who received her Master’s Degree in Crop and Weed Sciences from North Dakota State University, said farmers don’t want to be caught with a lot of grain in their bins in the summer and nowhere to take it.

Speaking of grain stuck in bins, farmers in southeast Minnesota still have a lot of grain to move from the 2015 harvest. Low prices at harvest made farmers very reluctant to sell grain that wasn’t forward contracted.

farmers have a lot of grain to sell

While exact numbers aren’t available, Lisa Behnken of the University of Minnesota Extension office in Rochester said there is quite a bit of grain in area bins waiting to be sold. (Photo from brockgrain.com)

“There are definitely crops to be sold,” Behnken said. “Some probably go forward contracted, but farmers don’t forward contract everything. Prices were down at harvest, so farmers didn’t sell right then, so it goes straight in the bin.”

While it’s important for commodity farmers to get their books in order, it’s equally important for livestock producers to watch their costs too, thanks to a recent run of lower prices.

“Cattle prices are softer,” said Behnken, “but the good side of that is they’re feeding animals much cheaper feed. However, they’re end product has also come down in price too.”

Do lower cattle prices mean it’s time for America’s livestock farmers to start expanding the beef herd? She said it all depends on your books and cash flow that your banker sees in those books.

“It’s all about operating money,” Behnken said. “You still have to go to the bank and make this whole thing cash flow. If I’m in the market to buy some feeders, I still have to have the cash to buy those feeders. Even if a farmer is raising his own corn to feed the animals, he still has to have cash necessary to buy the feeders.”

Cash flow. It’s more important than it’s been in many years, and it’ll determine what kind of decisions farmer make this year, and whether or not they stay in business.

“For some, it’s where their debt load is at,” said Behnken. “What’s my percentage of debt? If you have a more solid equity base, that’s a little different than if you’re highly leveraged. Then, it’s a whole different ballgame.”

 

 

 

 

 

Why FFA and agriculture are the Best Things Ever

By: Talisa Smith

A recent article by PETA described FFA as “lame AF.” Now, I see more and more posts from people who used to be in FFA agreeing with PETA. You folks that changed your mind, I’m betting you only did it because other people did. That means you are not, and never were, a proud FFA member.

Let me start off by introducing myself. My name is Talisa Smith. I’m 16 years old, and from Fort Pierre, South Dakota. Right now I’m a sophomore at Stanley County High School. I have been a FFA member for three years now, and I can say I would never go back in time and change my mind about becoming one

I am my chapter’s reporter and am stationed by the flag when we hold meetings. Much as the flag covers the United States of America, I strive to inform every man, woman and child I can that FFA is a national organization. It reaches from the state of Alaska to Puerto Rico, and Maine to Hawaii. I am there to let everyone know what goes on in the chapter. So I’m going to tell you what FFA is to me and what my side of the story is.

Many people have read this article about how we are a lame organization. One thing that most people probably don’t realize is that those pictures they have are entirely out of context. What they said is wrong and they clearly don’t know what they are talking about.

In one point that they made, it states FFA teaches kids to raise animals and send them to the slaughterhouse to have them cut apart while they are still living. Well yes, these animals do die so that people don’t starve. However, the methods that they say they use to put the animals down are wrong.

In a slaughterhouse the animals are put down with a stun gun to the head because it’s painless to the animal and quick. The other way is they are put down is by a gas. To make sure that they are dead, workers will drain the rest of the blood so the animals don’t suffer. Then they are butchered for the meat so that the world can have food.

They had also mentioned that sheep tails are cut off and ears are pierced without using painkillers. Cutting the tails off is a process is called docking and it is for the sheep’s benefit. If we don’t do this, the tails would end up getting dirty and infection is a good possibility. We dock the tails so the sheep can stay healthy and not get sick. They don’t feel anything but a little pinch when they do this.  When we pierce their ears, it’s basically a small hole, just as cows get tags in their ear to tell them apart.

The next allegation is we steal calves away from their mothers. We bottle feed those calves instead of giving them milk from the cow. The milk we get from the cows is not just used for drinking. That is used for all sorts of thing like, cottage cheese, cheese, and ice cream. So if we take away that milk, you are going to take away ice cream. Do that, and you have to tell your kids that you are the reason that they can’t have any more ice cream. Now, to me, that just doesn’t sound right.

FFA and agriculture

Stanley County FFA chapter members volunteer to clean up local emergency vehicles as part of summer camp activities. (Contributed photo)

Another point in the article says that the skills needed to stand up and talk in front of a group are lame, uncool, and have no purpose in the world anymore. The article says people should just stick to their phones. What happens when you want a job and you can’t talk to someone in person? You can’t talk only through texting. I can tell you this: you will not get hired and you will not find a job if you can’t have a decent face-to-face conversation.

The article said it’s cooler to judge people instead of knowing different kinds of livestock and other animals. Well you are now saying that it is ok to belittle people and lower their self-confidence. FFA is trying to stop that in the first place.

FFA and agriculture

Talisa Smith of the Stanley County FFA chapter poses with the Peterson brothers, farmers who are nationally known Ag advocates. They made an appearance at a recent South Dakota State FFA convention. (contributed photo)

They had stated that it is better to be a follower than it is be different and stand up to be a leader. You are going to tell people that it’s better to act and follow someone than to stand up and be yourself? I am proud of who I am and I’m not afraid to stand up and be a leader that may change the world for the better.

Many FFA members take care of animals and know how to feed them and give them the right medicine so they don’t get sick. We want our animals to be the healthiest they can be. We take pride in this because we are feeding the world while doing something that we love to do. Some people are saying that’s dumb. You shouldn’t do that. Instead, be more like PETA and just talk about caring for animals, and not actually doing it. Well if nobody raises livestock, then what happens? We have no food if farmers just stop working. Great: We got everyone to stop like you wanted, but guess what? We have no food for anyone. Now what do you want us to do? We’ll see FFA members and the farmers they might grow up to be as where you’ll get your food from, so we need them.  Did you know that 1 farmer feeds at least 100 people, if not more?

 

FFA and agriculture

National FFA officers often take over local classes to teach life skills all FFA members can use. (contributed photo)

FFA doesn’t just teach you about agriculture. It teaches you life skills that you can use everywhere. You will meet great people along the way that you never would have met in the first place. There are 692,327 members right now, and 7757 chapters in the United States, Puerto Rico and the Virgin Islands. Those numbers are growing each year and I am so glad for that. Our mission is FFA makes a positive difference in the lives of students by developing their potential for premier leadership, personal growth and career success through agricultural education. And our motto is Learning to Do, Doing to Learn, Earning to Live, Living to Serve. As an FFA member I am proud to live by this with everything I’m doing. I don’t think that most people realize is that agriculture is everywhere and is in almost all the jobs that we have.

So the next time someone wants to say that FFA is lame AF and belittle FFA and agriculture, make sure you do some research on it so you know what you’re talking about. You are also offending everyone involved because you information is wrong and hurtful.

 

 

CoBank Report Predicts Easing Of U.S. Protein Glut

DENVER, Colo. (January 21, 2016) —The supply glut that plagued U.S. beef, pork and poultry protein markets last year and ratcheted down margins is expected to ease in 2016, according to a new research report from CoBank.

The bank, a major agribusiness lender, says leading indicators point to animal protein supplies moving toward a state of equilibrium, with protein stocks more in line with overall levels of demand.

Meat Protein supplies expected to ease this year.

Trevor Amen is a protein specialist at Cobank. He expects improving market conditions for US beef, pork, and poultry producers in 2016.

“It’s clear that in the coming year, the headwinds and adverse conditions created by excessive protein stocks are clearing,” said Trevor Amen, animal protein economist with CoBank. “Surprisingly strong U.S. consumer demand helped lay the groundwork for improving market conditions in the coming year, meaning the net trade balance is expected to shift toward growing exports and fewer imports.

“This is welcome news for U.S. beef, pork and poultry producers.”

On the Horizon
In the first half of 2016 protein exports are expected to remain somewhat of a challenge. “But conditions are predicted to improve over depressed 2015 levels due to a variety of economic factors,” added Amen.

Meanwhile, imports of lean beef should slow significantly and domestic consumer demand for beef, pork and poultry is anticipated to remain strong and supportive of prices. Supply imbalances have already begun the correction phase, with supply and demand expected to achieve equilibrium by about mid-year. The strength of consumer demand going forward will impact how much and how soon U.S. meat prices change.

For instance, meat demand in the restaurant sector continues to grow. The Restaurant Performance Index and the Expectation Index each indicate positive restaurant business conditions. Combined with lower gas prices, current consumer attitudes indicate a willingness to spend more at restaurants versus in-home meals during 2016.

Price outlooks are mixed:

  • Pork and chicken prices have an upside potential compared to last year’s low levels, based on adjustments made for future production.
  • Beef prices will likely remain under pressure for the next two years, however, as the industry is coming off cyclical highs of 2014.

Of course, optimism for 2016 should be tempered by the oversupply lessons of 2015.

“Total red meat and poultry production set an all-time high in 2015,” said Amen. “Combined with fewer exports and more imports, total domestic meat supplies surged by 4.4 percent, the highest year-over-year increase in 40 years.” That increase in supply translated to an additional 9 pounds of protein per person—historically, protein supplies rose an average of 0.8 pounds per person per year from 1960 to 2015.

As the market works through the recent protein oversupply hangover, the long-term outlook remains positive, especially with continued global middle class growth. “The increasing demand for a higher-quality diet likely provides domestic protein producers with significant opportunities in the next decade,” concludes Amen.

A synopsis of the 2016 Protein Demand Outlook Report is available at www.cobank.com. The full report is available to media upon request.
Meat Protein supplies expected to level off in 2016, thanks in part to surprising domestic demand and improving exports.

About CoBank
CoBank is a $110 billion cooperative bank serving vital industries across rural America. The bank provides loans, leases, export financing and other financial services to agribusinesses and rural power, water and communications providers in all 50 states. The bank also provides wholesale loans and other financial services to affiliated Farm Credit associations serving more than 75,000 farmers, ranchers and other rural borrowers in 23 states around the country.

CoBank is a member of the Farm Credit System, a nationwide network of banks and retail lending associations chartered to support the borrowing needs of U.S. agriculture and the nation’s rural economy. Headquartered outside Denver, Colorado, CoBank serves customers from regional banking centers across the U.S. and also maintains an international representative office in Singapore.

For more information about CoBank, visit the bank’s web site at www.cobank.com.

Famers assessing their finances for 2016

January is a time when farmers are typically doing paperwork, looking back at 2015 ahead of the upcoming tax season.

What some may find is their books don’t necessarily balance they way they want. The good news is, it’s possible to make better decisions in a difficult Ag economy if you have a clear understanding of where you’re operation is at financially.

Rob Holcomb wants farmers to keep a sharp eye on their finances heading into 2016.

Rob Holcomb is a University of Minnesota Extension Educator, specializing in Ag Business Management over in the Marshall regional office. (Photo from extension.umn.edu)

“What I’m seeing happening right now is people in the habit of doing a FINPACK (software from the Center for Farm Financial Management) analysis,” said Rob Holcomb, Ag Business Educator for the University of Minnesota Extension Service, “including balance sheets and income statements, are really analyzing what happened in 2015.”

He added, “A lot of people are doing analysis, and unless they’ve got some special circumstances, farm returns are due on March 1.”

Dave Bau is encouraging farmers to get their finances in line.

Dave Bau is a University of Minnesota Extension Educator also specializing in Ag Business Management, and based in the Worthington office.

Looking ahead to 2016, Holcomb said the financial condition on farms is a mixed bag.

“We had people last year that had big trouble managing the tax bill,” Holcomb said. “What led to this challenge was the buildup of $8 per bushel corn, which caused more trouble than first thought. You hate to be negative about it, but I knew it would cause trouble down the line, and that’s what we’re finding now.”

He said certain farmers were doing a lot to avoid paying some taxes, like deferring income to the next year.

“They were also maxing out on pre-payments,” Holcomb said. “The problem is, a lot of farmers were rolling these massive deferred tax liabilities forward every year, even though they’re showing a loss. They may have a loss over the last couple years on their accrued farm income, but they still have this cash they have to deal with, because if they don’t do it, they have a monstrous tax bill.”

He said a lack of steady farm income leads to an obvious problem in that situation.

“The challenge is the recent lack of cash flow is such that they can’t afford to have that big tax bill,” Holcomb said. “In a sense, they’ve backed themselves into a corner with their tax problem.

“But that’s not everybody,” he added. “Some folks have been paying a little more as they go and didn’t have a big aversion to paying taxes, I think those folks are in much better shape.”

Holcomb said one of the big buzzwords in the Ag industry is working capital.

“It’s a current and intermediate cushion that the farmer has,” Holcomb said. “The more working capital you have, the better. Unfortunately, we’ve been burning some working capital over the last couple years. That’s probably the thing that lenders are getting the most squeamish about right now.

The lack of working capital on some farms is showing signs of getting serious.

“I got a call last week from a banker in my area that was asking about lender mediation,” Holcomb said. “That conversation can only be the result of one thing, which is a farmer out there that the bank is getting ready to pull the plug on.

“That means there are farm folks who could be in tough shape,” he added.

He’s especially worried about young farmers.

“When the $8 per bushel corn began coming down,” Holcomb said, “some of the younger guys were paying ridiculous land rental rates to try and get their hands on some acres to work. The problem is they’ve got the least ability to weather out low prices because they don’t have a lot of working capital. They have a cost structure that’s not sustainable.”

High land rental rates are squeezing farmers finances.

The high cost of land rental rates in farm lease contracts are putting a heavier squeeze on farmers and their financial bottom line than we’ve seen in several years. (photo from americasnewfarmers.org)

Rents are beginning to come down, but they have a ways to go to ensure profitability for both farmers and landowners.

Rent is the largest input cost for corn and soybeans,” said Dave Bau, University of Minnesota Ag Business Management Educator in Worthington. “Rents are going down, but at current corn and bean prices, they should be around $100 to $125 an acre. Even base rents on flexible leases are still much higher than this.”

There is still pressure on farmers for land rents to remain very high for at least one more year.

“Farmers are doing more and more flexible agreements with a base rent and additional rent if prices improve,” Bau said. “With other input costs not coming down significantly, break-even prices for corn are $3.80 to $4.00 for corn, and $9.50 to $10 for soybeans.”

Bau adds, “Cash prices currently are around $3.40 for corn, and $8.25 for soybeans.”

With this much economic gloom ahead, what’s the key to surviving the downturn in 2016?

“I think the number one thing is you have to get your cost structure in line,” Holcomb said. “Land rent is one of those high costs that can be negotiated. $400 land rent won’t work right now.”

One of the best things farmers can do is figure out where they’re at financially before they make decisions on the year ahead.

“The farmers I fear for the most are the ones that aren’t doing any kind of financial analysis,” Holcomb said. “They have no idea where they’re at. It’s a sad situation when they find out they’re in trouble, and it’s their banker that tells them”

He added, “The smart producers know where they’re at, and that can alleviate a lot of trouble.”

Farmers need to do a better job of marketing their products in 2016.

“There are marketing workshops going on around the state,” Holcomb said, “and I think it’s really important to look at that.”

 

 

 

 

 

 

Pork industry educates Subway on antibiotics

The Subway restaurant chain recently brought antibiotics in animal agriculture back into the national food discussion with an announcement about changes in how they source proteins.

In late October, Subway announced policy changes on it’s website, saying that the chain will only serve proteins that have never been treated with antibiotics. The transition is set to begin in it’s over 27,000 restaurants as early as 2016.

The animal agriculture industry recently met with Subway to ask questions about the new policy, as well as to educate the company about the necessary use of antibiotics to keep animals healthy.

Pork production

The pork industry, along with representatives from poultry and beef, are educating Subway as well as the public on the necessity of using antibiotics in animal agriculture to ensure the animals are healthy and safe. (photo from pork network.com)

The Kearny, Nebraska, newspaper (KearneyHub.com) recently wrote an article describing Subway’s policy change as “running into a brick wall in Nebraska.” Livestock producers rely on antibiotics to keep their animals healthy, and Subway changed its policy, stating that they would “accept meat from animals that had been treated with antibiotics to control illness, but not given antibiotics to aid in animal growth.”

National associations that represent the pork industry had a lot to say on the topic. The website meatpoultry.com restated the National Pork Producer’s Council’s position that antibiotics must be available to producers to maintain animal health. The US Food and Drug Administration regulations on antibiotics in animal agriculture are increasingly strict, and they provide safeguards against resistance.

All pork organizations agree they need to educate the public on the necessity of pork production, as you’ll hear in this audio wrap:

 

 

For help in answering questions from the public, the National Pork Producers put together a video to help you educate people who have questions about why farmers use antibiotics:

 

WOTUS rule postponed nationwide

Here’s a conversation on the 6th Circuit Court of Appeals staying the implementation of the controversial Waters of the US Rule (WOTUS):

 

WOTUS

The EPA’s implementation of the Waters of the US Rule was stayed nationwide by the 6th Circuit Court of Appeals today. (Photo from alaskapolicyforum.org)

The Sixth Circuit has just stayed the Waters of the United States (WOTUS) rule nationwide, by a 2-1 vote, until it determines whether it has jurisdiction over the petitions for review.  The majority found a substantial possibility of success on both merits grounds (that the rule does not comport with even Justice Kennedy’s Rapanos opinion) and procedural grounds (that significant changes in the rule were never put to notice and comment).

The order is, “The Clean Water Rule is hereby STAYED, nationwide, pending further order of the court.”

A stay has the same practical effect as an injunction – it prevents the EPA/Corps from implementing the rule.

Expect the stay to last until the 6th Circuit makes a decision regarding the jurisdictional issue, which is expected sometime in November.

Here’s the link to the story on KLGR radio’s website:

http://www.myklgr.com/2015/10/09/6th-circuit-court-stays-wotus-rule-nationwide/

Here’s a video from the Kansas Farm Bureau featuring Paul Schlegel, the Director of Environment and Energy Policy at the American Farm Bureau Federation in Washington, D.C.

 

Mental stress hard on Agriculture

The recent collapse in commodity prices are putting a damper on agriculture’s bottom line, which can lead to challenges, especially between a farmer and their family.

Lower commodity prices and recent unfavorable weather have upped the stress level in farmers all over the country, and 2 experts at Kansas State University want you to know it’s normal, and it’s okay to seek help in dealing with challenges, many of which are unique to farming. (photo from fyi.uwex.edu)

Lower commodity prices and recent unfavorable weather have upped the stress level in farmers all over the country, and 2 experts at Kansas State University want you to know it’s normal, and it’s okay to seek help in dealing with challenges, many of which are unique to farming. (photo from fyi.uwex.edu)

Mental health can be overlooked in the day-to-day challenges of farming. During the down cycles, which are typical for agriculture, it’s more important than ever that farmers take care of themselves and their families. Mental health experts at Kansas State University say it’s easier to fight through the tough times together, rather than trying to do everything yourself.

“Typically, when we hear from people, it’s not one stress but a pileup of different things that are happening,” said Charlie Griffin, a Research Assistant Professor in the Kansas State University School of Family Studies and Human Services. “Financial issues, weather issues, the daily issues that always crop up like the combine breaking down at harvest time, and they all pile up simultaneously.”

Charlie Griffin

Charlie Griffin is a Research Assistant Professor of Programs for Workplace solutions in the School of Family Studies and Human Services at Kansas State University. (Photo from k-state.edu)

He added, “That’s when we really start to hear from people.”

Griffin said different sectors of agriculture could experience stressors while other sectors are succeeding.

“It depends on who you’re talking to and what sector (of Ag) you’re talking about,” said Griffin. “Throughout my time in agriculture, I’ve realized what may be good for livestock farmers may not be good for crop farmers, and vice versa. But if you look at the folks that are diversified, they can balance back and forth one way or the other.”

Griffin adds, “The livestock farmers I’ve talked to are doing really well.”

Lower crop prices can typically bring on the most stress during the winter.

“I start hearing the stress from prices in early winter,” said Griffin, “when people finally sit down and add up their bills and their income, look at government payments, all to get ready for taxes, and that’s when the big picture comes along.”

Griffin said when crop prices take a big tumble, the temptation may be to draw comparisons to the farm crisis in the 1980’s. He said those conditions will always be hard to duplicate.

“I’m going to say the early 80’s were the perfect storm for agriculture,” said Griffin. “Everything went the wrong direction at the wrong time. Interest rates were sky high, people were borrowing big time to expand, prices fell out, input costs jumped, and the weather played havoc. Agriculture was hit hard.”

He added, “But the big thing was what happened in the banking industry. With people so dependent on borrowed money to operate from year-to-year, the banking industry changed how it was regulated. Bankers began to call in loans because they didn’t have enough collateral to cover it due to the drop in land prices. Everyone said that would never happen.

“We’ve certainly never seen anything like that again,” said Griffin.

Griffin said farmers are a very resilient bunch, but there are strategies he recommends for farm families to get through the lean years successfully.

“Be tight on your financial management,” said Griffin. “Make sure you’ve got some way of staying on top of it, including using a financial planner or manager if you need one. After all, the stress you know is a whole lot easier to manage than a vague stress you don’t know.

“The people who handle their stress better are those who go out and access resources,” said Griffin. “They go to Extension meetings, workshops, trainings, and they hire the kind of input they need. They’re learning how to do things better.”

Griffin said the other side of the coin is family communication. It’s all about how you’re handling any stress between you and your spouse, or any other family members in the operation.

“The important thing to remember is communication between family members takes work,” said Charlotte Shoup-Olsen. “It needs the most work and attention when things aren’t going well. That’s when arguments tend to happen.”

Charlotte Shoup Olsen is Professor/Extension Specialist in the College of Human Ecology at Kansas State University in Manhattan, Kansas.

Charlotte Shoup Olsen is Professor/Extension Specialist in the College of Human Ecology at Kansas State University in Manhattan, Kansas.

Disagreements are inevitable in family and business relationships, but it’s important to handle them correctly.

“Always be respectful in your communication with each other, even when you disagree,” said Shoup-Olsen. “You can disagree and still be respectful. In other words, you don’t call each other names, you don’t put them down with sarcasm, and you just be respectful.”

She said listening skills are a big key to resolving differences.

“Listen with the intent to try to understand where the other person is coming from,” said Shoup-Olsen. “Often times, in a bad conversation, you’re listening to see when you can pounce on something the other person said.”

She added, “It’s best if both parties take turns speaking and listening to each other, and doing so respectfully.”

Griffin said should the occasion arise where families are having a hard time talking, it’s important to get help.

“If you can’t sit down and talk about things in an adult way and successfully, the best thing you can do is get someone from the outside to help you,” said Griffin. “Not necessarily a therapist, but someone who can sit in and dialogue with the whole family and answer questions.”

 

 

 

 

 

 

 

Watching my first Goat show

My most recent assignment was to cover a goat show, aptly named, the Never Boering Goat Show, at the Freeborn County Fair in Albert Lea, Minnesota.  The complete article will appear in the Tuesday, August 4th edition of Agri News.  Here’s just a few excerpts and the accompanying video.

The Never Boering Goat Show took place in Albert Lea, Minnesota, on July 17, 18, and 19, at the Freeborn County Fairgrounds. The show had recently taken a 3-year hiatus after running for years in Sioux City Iowa. Cary Larson of New Richland resurrected the show and brought it to Minnesota.

“The show took place under this name during the county fair in Sioux City,” said Larson. “The gentleman who ran the show sold out of his Boer Goats because his interests had changed, which is not unusual. I called the gentleman up and said ‘I’d like to reboot the show. Are you okay with that?’ I got his blessing and ran with it.”

He said Albert Lea, Minnesota, is an ideal location for the reboot of this show.

“It’s ideal, especially with the crossroads of Interstates 35 and 90,” said Larson. “We have plenty of people who made the trip from South Dakota and Iowa here. The fairgrounds here are wonderful, especially for a livestock event like this.”

If you’ve never been to a livestock show, especially with goats, here’s a little bit of what I saw during the show:

Here’s part two:

Proposed changes to the Beef Checkoff

Many of the major American agriculture groups came together earlier this year to sign a Memorandum of Understanding regarding a proposed change to the national beef checkoff. The discussions were contentious at times, and at least two of the groups dropped out of the discussions due to disagreements.

The discussion included more than how to raise the checkoff from 1 to 2 dollars per head sold. Several major proposals to enhance the checkoff came out of the discussions as well.

“We came to a point in the discussions where we wanted to know what else we could do to enhance the checkoff,” said National Cattlemen’s Beef Association Past President Scott George. “It took a lot of compromise across the board to get things done. We focused in on 4 main areas.”

Scott George

Scott George is a dairy farmer and beef producer from Wyoming, and he served as the President of the NCBA in 2013. (photo from BeefMagazine.com)

“If you debate a hundred different things,” said George, “you’ll never get agreement on all of them.”

The first discussion item was the biggest one, and it was how much to actually increase the checkoff.

“There were people that argued strongly that Australia is charging $5 a head on their checkoff,” said George. “Canada is charging $4 a head. These countries are competitors, and there were people in the room saying we need to collect $5 a head to compete with these folks.

“Others were saying to get back to par we need to collect $2.20,” said George, “but $2.20 is not easy for people to figure out. Let’s say you’re selling 137 head of cattle. A checkoff collector would have to multiply 137 by $2.20, and that’s not simple.”

When the group was putting the proposal together, representatives from the Livestock Marketing Association and the National Livestock Producers Association, which are both auction market associations, were involved in the process. George said they wanted to keep this process as simple as possible.

George said, “In the end, the group said let’s raise it at least a dollar. Let’s go to 2 dollars, because it’s simple and clean. Everyone can understand it. So the group compromised on the money.”

Beef cattle in Sale Ring

For each head of livestock sold, beef producers currently pay $1 per head to the national checkoff. A new proposal would change that to $2 a head, but have a refund available for producers who don’t want to pay the extra dollar. (Photo from angusbeefbulletin.com)

George said raising the checkoff amount requires an act of Congress. The group came up with an idea to make the process a little simpler.

“We proposed a change in the referendum process,” said George, “in which you can petition to change the checkoff amount in the referendum process, rather than requiring an act of Congress. So, we compromised on the dollar amount, and going forward, if in 5 to 10 years we feel like we need to raise more money, we do it through the referendum process and producers have the final say.”

George said when you talk about enhancing a program like the checkoff, there are a lot of costs that go into it. The idea of cost to producers led to talk of a refund policy.

“We decided the second dollar would be refundable,” said George. “If you don’t like it, you can get your money back. We thought of putting requirements in the agreement, like maybe they should have at least 10 cows. After all, it costs money to do a refund. Someone has to sit down, do the paperwork, and mail the money back to you. We also talked about charging producers a fee, but in the end, we said that’s not fair.”

George added, “If a person wants a refund, they should get the full amount, whether it’s a dollar for 1 head, or 10 dollars for 10 animals. A big selling point to this is we have people in Congress that don’t like checkoff programs, and the fact that constituents can get their money back for any reason might help us with Congress as well.”

He added that the initial $1 collected today would remain as it is with no refund allowed. This would maintain financial stability for the state Beef Councils and at the national level they can plan on a certain amount of money to run a program.

“In this Checkoff Enhancement Working Group,” said George, “some strongly advocated for a mandatory referendum every 5 to 7 years. But to do a referendum would cost the checkoff into the millions of dollars.

“Some members of the group strongly objected, saying they weren’t paying into the checkoff to spend millions of dollars every 5 years to see if they want to keep the program.”

The group then looked at several different checkoff programs as potential models of what they’d like to see. Currently, there are 19 different checkoffs with varied models in use.

“The checkoff that the group liked the most was the soybean system,” said George. “In the soybean model, the Secretary (of Agriculture) designates a certain time period every few years. During a certain month, the Secretary will say everyone can go to their government agency office to verify they are a producer who’s qualified to do this, and sign a petition for a referendum.

“If 10 percent of the producers sign the petition,” said George, “then the Secretary will hold a referendum.”

One of the big reasons for changing the petition process is consistency.

“There was a petition drive a few years ago,” said George, “and there were 3 different reprimand letters issued by the USDA because people were holding drawings for things like hats and boots. People were signing up thinking they were just registering for a drawing. In reality, there were signing a petition for a referendum.

“The USDA had to go back and hire an outside firm to take all these signatures that had been submitted and verify that they were producers,” said George. “When many of the people were called, they said ‘we don’t know what you’re talking about. We’ve never owned cattle in our life.’

The US Department of Ag had to verify producers knew they were signing up for a referendum when they were told it was just registering for giveaways.  (photo from commons.wikimedia.com)

The US Department of Ag had to verify producers knew they were signing up for a referendum when they were told it was just registering for giveaways. (photo from commons.wikimedia.com)

George said, “This is one of the issues we’re trying to address. By having producers go to an FSA office or Extension building, setting aside a set period of time, and having it every 5 years, we thought this would be a good compromise.”

The Checkoff will still bear the cost of the referendum, but the USDA would help bear the cost of gathering the signatures. Producers could petition for getting rid of the checkoff, or even increasing the amount of the checkoff through the process too.

George added, “If, in 5 years, during the month of January 2020, the Secretary will say the beef producers can go in, sign up, and if ten percent of them go in and say they want to increase the checkoff to $2.50 a head, they’ve then petitioned for a referendum. The process allows you to step forward for an increase, or to eliminate the program as well.”

He said this was yet another compromise in the process.

“Under our current law (the 1985 act), if 10 percent of the producers sign a petition at any time, and request a referendum,” said George, “the Secretary of Ag will hold a referendum. We thought that was a good safeguard; so let’s leave that one in there as well. So, if producers get upset with the checkoff for any reason and ten percent sign the referendum, then bang, the Secretary will have a referendum and we’ll have a vote.”

George said it was important to the Group to give the producers the final say in whether or not the checkoff will continue.

“Under this whole process, we’re talking about working through Congress to get it passed, get the President to sign it, and then get the Secretary to write the order,” said George. “But before it would be enacted, it will all have to go before the producers in a referendum. The producers need to have the final say. The Group was unanimous on that declaration. Nobody needs to force this down someone’s throat.”

The last thing the Board did was deal with some confusion over the involvement of industry groups in the checkoff.

“The checkoff benefits every cattle producer in the country,” said George. “I don’t care what segment of the industry, be it cow/calf, stocker, feeder, or dairy. I don’t care if they raise bucking bulls or roping steers. In the end, it brings value to every single segment.”

He added, “It’s not political. Just because NCBA does some of the checkoff programs, it doesn’t mean only buy cattle from NCBA members. It’s fallacy to think that. But there are other industry organizations that want to be involved.”

George said it’s important to remember that the group that has authority over the checkoff is the 20 member operating committee, which has ten Federation seats and ten Beef Council seats.

“Right now, the Beef Board has a separate nominating committee that interviews candidates for the Beef Board seats. The Federation (of state Beef Councils) has a separate nominating committee to interview candidates for their seats. So we came up with a compromise in the interview process.”

He said the Beef Board nominating committee has 7 seats, and the Federation nominating committee also has 7 seats.

“What we’re proposing is 7 additional seats be given to industry organizations that want to participate,” said George. You’ll have a 21-member nominating committee to interview candidates for the Federation and the Beef Board seats. They will have to receive a two-thirds majority vote to move that candidate forward.”

One group in particular didn’t like that suggestion, but George said there were good reasons for it.

“They said ‘we just got all the policy people kicked out of here,’” said George. “But other groups said having industry organizations sitting in the room looking at the quality of candidates and helping with the decision gives them ownership and involvement. It can’t help but educate the people about who they are interviewing and what we’re trying to accomplish with the checkoff.”

The goal of this process is to get qualified candidates for the Beef Operating Committee.

“This idea was a compromise, just like the others,” said George.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Minnesota turkey growers hit hard by H5N2

An avian influenza outbreak began in Minnesota on March 4 of this year, with the first report coming from a commercial turkey flock in Pope County, Minnesota. The Minnesota Board of Animal Health website said the virus has been found in wild birds, as well as backyard and commercial flocks.

The Centers for Disease Control and Prevention considers the risk to people from the H5N2 virus to be low. In fact, the Board of Animal Health website said no human cases of the H5 virus have been detected in the United States, Canada, or internationally.

Minnesota is the largest producer of turkeys in the Union. Over 5.5 million birds have been affected by the outbreak, with turkey flocks around the state being hit the hardest. A few chicken flocks have been hit too. So far, 84 farms have been affected, and the virus has hit 21 of the state’s counties.

Steve Olson is the Executive Director of the Minnesota Turkey Growers Association, and he’s reminding the public that turkey is safe for human consumption (Photo from minnesotaturkey.com)

Steve Olson is the Executive Director of the Minnesota Turkey Growers Association, and he’s reminding the public that turkey is safe for human consumption (Photo from minnesotaturkey.com)

KLGR radio (Redwood Falls) Farm Director Dustin Hoffmann spoke with Steve Olson, the Executive Director of the Minnesota Turkey Growers Association, about the outbreak, and was kind enough to share the audio with me. You can listen to the report below:

 

 

 

If you have general questions about avian influenza and biosecurity, the Board of Animal Health has a phone number to call: 888-702-9963

 

To report a potential outbreak, please call 320-214-6700 Ext. 3804