READ the NAFB’s National Ag News for Wednesday, May 5th
Sponsored by the American Farm Bureau Federation
Ag Economy Barometer Mostly Unchanged from April
The April Ag Economy Barometer was 178, virtually unchanged from a month earlier. Last month, the index stood at 177, and just five points below its all-time high of 183 set back in October. Compared to March, however, there was a small change in producers’ perspective on the ag economy as they became more optimistic about the future, while their appraisal of the current situation waned. In April, the Index of Future Expectations rose five points to 169, and the Index of Current Conditions moved down seven points to 195. Ag producers continue to report expectations for solid financial performance on their farms and expect farmland values to continue to rise over the next year. However, producers were a bit less optimistic about the long-term outlook for farmland values, suggesting there might be some concern that recent farmland price rises might not be sustainable. And 95 percent of producers surveyed say they are concerted over new tax changes being considered.
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Dairy Checkoff Working with Entrepreneurs to Address Industry Challenges
Dairy Management Inc. has entered a partnership that will provide access to a network of inventors and entrepreneurs. The network is tasked with providing marketplace solutions for industry challenges focused on health and sustainability. DMI is partnering with Venture Winston Grants, which has designed a competition where startup companies can apply for funding that will allow them to incorporate dairy into their concepts in one of four areas. The areas include health and nutrition, biobased products, smart communities of the future and regenerative agriculture. Dwyer Williams, chief transformation officer for DMI, says, “We want to disrupt the marketplace before we’re disrupted and that requires looking for unexpected partners outside of the dairy industry.” The process is underway to identify potential startups who are a match for DMI’s four focus areas, with the expectation to have the winners named in January 2022. Barnes says once a technology is completed, it could take two to three years to have concepts commercialized and in the marketplace.
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Biofuel Groups Welcomes EPA’s Moves to Vacate Last-Minute SREs
The Environmental Protection Agency this week filed a motion in the D.C. Circuit Court to vacate three last-minute small refinery exemptions issued on January 19, 2021. In the last hours of the Trump Administration, the EPA issued the three waivers to Sinclair. According to EPA’s April 30 filing, the agency under the previous administration “failed to properly analyze the waiver petitions submitted by Sinclair.” The filing says the Trump administration’s EPA “granted exemption extensions that EPA now believes are ‘outside the scope of the EPA’s statutory authority.’” Renewable Fuels Association President and CEO Geoff Cooper states, “We strongly support EPA’s request for vacatur and remand of these three midnight-hour exemptions.” Growth Energy CEO Emily Skor says, “EPA is addressing the previous administration’s mishandling of the SRE program,” adding, “We are hopeful that EPA will continue to rein in the SRE program to achieve its limited purpose and ensure that the RFS advances the biofuels industry.”
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Farmers National: Interest in Farmland Selling to Increase
Land sales activity was flat the past few years, but that may soon change. The lower supply of farms for sale has been one of the factors that supported land values after the 2013 peak in prices paid for ag land. Farmers National Company reports seeing indications for increased land sale activity through to the end of 2021. Farmers National Company and its agents have already received an increased number of calls from landowners who are thinking about selling later in the year. The company says the main reason that will drive the current and upcoming sales decisions is that landowners are seeing a large and rapid run-up in land prices to levels last seen in 2013. The other reason that there might be more sales activity this fall is that a market doesn’t like uncertainty. Landowners are factoring in both the higher land prices and the uncertainty of future tax policy to make the call whether to sell now or keep the land.
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Consumers Considering Health, Environmental Impacts of Food Post-COVID-19
Consumers are increasingly considering their health and environmental sustainability as they shop for food. The COVID-19 pandemic has accelerated the trend in the past year, according to a panel of experts participating in Farm Journal Foundation’s Speaker Series. Half of consumers have made changes to what they eat in the past two years to lead a more sustainable lifestyle, according to Michael Hughes of FMCG Gurus. Hughes says changes to consumption patterns include reducing food waste, eating more local and fresh foods, and making greater attempts to check the sustainability credentials of food companies. Tina Owens of Danone North America told the panel, “Consumers are looking even more than they were before the pandemic to play activist with their grocery dollars.” And Christine Daugherty of PepsiCo says consumer brands have a large role to play in driving sustainability. PepsiCo recently unveiled a set of Positive Agriculture goals, which aim to impact seven million acres of farmland and reduce three million tons of greenhouse gas emissions by the end of the decade.
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USDA: World Food Gap to Narrow by 2030
The intensity of global food insecurity, indicated by a measure called the food gap, is projected to lessen over the coming decade in the world’s poorest regions. The improvement comes amid decreased incomes associated with pandemic-related drops in Gross Domestic Product, according to the Department of Agriculture. The food gap measures how much food is needed to raise consumption at every income level to meet the nutritional target of 2,100 calories per capita per day, a minimum intake to sustain a healthy and active lifestyle. For the four regions studied in the Economic Research Service International Food Security Assessment, the food gap in 2020 ranged from a low of 12 percent of the daily caloric target in North Africa to 20 percent in Sub-Saharan Africa. Income growth, along with relatively stable prices for major grains and lower population growth, are contributing factors to this improvement, However, the gap is 12 percent higher than earlier estimates reported by USDA after pandemic-related revisions.
