NATIONAL AG NEWS SPONSORED BY THE AMERICAN FARM BUREAU FEDERATION

National Ag News for December 6, 2022

Farm Capital Expenditures Increasing with Farm Income Rise

In response to relatively stronger net farm incomes, U.S. farm sector capital expenditures have increased dramatically in the last three years, according to research by the University of Illinois. In 2019, farm sector capital expenditures were approximately $30.1 billion. The forecasted value for 2022 is $44.2 billion. Capital expenditures include tractors, trucks, autos, machinery, buildings, land improvements, and miscellaneous expenditures. Capital consumption represents the declining balance of capital stock or economic depreciation. The ratio of capital expenditures to capital consumption increased from 1.06 in 2019 to 1.70 in 2022. The data implies that farmers have used a portion of their strong net farm incomes in the last few years to replenish their capital stock. The changes in expenditures during the last four years have differed among expenditure categories. Specifically, increases were larger for tractors and machinery than for autos, trucks, buildings, and land improvements.

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Food Price Index in November Virtually Unchanged

The FAO Food Price Index averaged 135.7 points in November 2022, virtually unchanged from October. The index offered month-on-month decreases in the price indices for cereals, dairy and meat, nearly offsetting increases in vegetable oils and sugar. At this level, the index stood only marginally above—0.3 percent—its corresponding value in November 2021. The Cereal Price Index averaged 150.4 points in November, down 1.9 points from October, but still 6.3 percent above its value a year ago. The Oil Price Index averaged 154.7 points, up 3.4 points after declining for seven consecutive months. The Dairy Price Index averaged 137.5 points, down 1.7 points, but remained 9.2 percent above its value a year ago. The Meat Price Index averaged 117.1 points, down 1.1 points from October, but 4.1 percent above its value a year ago. Finally, the Sugar Price Index averaged 114.3 points in November, up 5.7 points from October.

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Cover Crop Mixes account for 18 – 25% of Cover Crop Acreage

USDA’s Economic Research Service finds cover crop mixes account for 18 to 25 percent of acres with cover crops. However, the use of single-species cover crops is more common. For corn fields in 2021, almost 75 percent of acres with cover crops used a grass or small grain cover crop, such as cereal rye, winter wheat, or oats. At 44 percent of acreage, cereal rye was almost twice as common as winter wheat as the cover crop on corn for grain fields. Rye and winter wheat were also the most common cover crops on soybean fields in 2018. Winter wheat was the most common cover crop used on cotton fields in 2019. Farmers add cover crops to a rotation to provide living, seasonal soil cover between the planting of two cash or forage crops. Including cover crops in a rotation can provide benefits such as improved soil health and water quality, weed suppression, and reduced soil erosion.

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USDA Launches New Virtual Nutrition Center of Excellence

The Department of Agriculture Monday announces the new Agricultural Science Center of Excellence for Nutrition and Diet for Better Health. The virtual center is part of President Biden’s Cancer Moonshot effort to end cancer as we know it. Agriculture Secretary Tom Vilsack says, “The virtual center will connect existing resources, including people and programs, to leverage expertise and increase coordination and cooperation.” USDA is enhancing its research focus on precision nutrition science to better understand the needs of underserved communities. The research complements efforts to advance food and nutrition security – which means consistent and equitable access to healthy, safe and affordable foods essential to optimal health and well-being, according to USDA. The World Cancer Research Fund claims 30-50 percent of all cancer cases are preventable by following a healthy diet and lifestyle. As part of the announcement, USDA convened a panel of experts that discussed nutrition’s role in improving overall health and reducing risks for diet-related chronic diseases.

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EPA Proposes Elimination PFAS Reporting Exemption

The Environmental Protection Agency Monday proposed a rule to end an exemption used to avoid disclosure of certain PFAS releases. The exemption allows facilities to avoid reporting information on PFAS when those chemicals are used in small or minor concentrations. Because PFAS are used at low concentrations in many products, the rule would ensure that covered industry sectors and federal facilities that make or use PFAS will no longer be able to rely on the exemption to avoid disclosing their PFAS releases and other waste management quantities for these chemicals. PFAS chemicals have been used to make various commercial products, including non-stick cookware, stain-resistant carpets and furniture, water-resistant clothing, coated oil-resistant paper and cardboard food packaging, and some personal care products. Agriculture and PFAS chemicals can intersect through air, water, and soil, according to the Maine Department of Agriculture. One way that PFAS may enter soil is through the application of residuals such as biosolids, industrial sludges and ashes.

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Gas, and Diesel Prices Fall Again

The national average gas price fell 15.8 cents over the last week, down to $3.36 per gallon. The national average is down 43 cents from a month ago and 1.5 cents per gallon higher than a year ago. The national average diesel price fell 13.6 cents last week to $5.06 per gallon. GasBuddy’s Patrick De Haan says, “it remains very possible the national average could fall under $3 per gallon by Christmas.” De Haan expects diesel prices to fall under $5 per gallon this week, and soon reach its lowest level since March of this year. While the declines are welcomed, De Haan cautions that there may be some concerns coming as the price cap on Russian oil kicks in. Further, retaliation is possible, and while OPEC+ upheld production cuts from last month, they could always cut more production. Meanwhile, U.S. retail gasoline demand rose last week by 2.3 percent, bouncing back the week after Thanksgiving.

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By Tucker Allmer - The BARN

Tucker Allmer & the BARN are members of the National Association of Farm Broadcasting (NAFB), the Colorado FFA Foundation, the Colorado 4H Foundation, the Colorado Farm Show Marketing Committee, 1867 Club Board Member, Denver Ag & Livestock Club Member, the Weld County Fair Board, the Briggsdale FFA Advisory Council, Briggsdale 4H Club Beef Leader & Founder / Coordinator of the Briggsdale Classic Open Jackpot Show.

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