NATIONAL AG NEWS SPONSORED BY THE AMERICAN FARM BUREAU FEDERATION
National Ag News for May 15, 2023
USDA Releases U.S. Crop Production Outlook
USDA projects a record U.S. corn crop of 15.3 billion bushels, up over 10 percent on increases to both area and yield. The yield projection is 181.5 bushels per acre. The 2023-2024 corn outlook calls for larger production, greater domestic use and exports, and higher ending stocks. Total corn supplies are forecast at 16.7 billion bushels. The season-average farm price is expected to be $4.80 a bushel, down $1.80 from the prior year. The U.S. soybean crop will be 4.51 billion bushels, up five percent from last year on higher yields. Soybean supplies are projected to be up four percent to 4.75 billion bushels. The season-average soybean price is forecast more than $2 lower at $12.10 per bushel. The USDA’s all-wheat production is forecast at 1.65 million bushels, up slightly from the previous year. The all-wheat yield is projected at 44.7 bushels, and the season-average price is down to $8 a bushel.
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Credit Conditions Strong as Interest Rates Climb
Agricultural credit conditions in the Tenth District of the Kansas City Fed remained strong, and farm real estate values continued to increase. However, growth has softened. While improvements in farm finances and credit conditions steadied and some lenders expected a deterioration in the months ahead, multiple years of strong incomes continued to keep credit stress low. The outlook for the U.S. farm economy in 2023 remained favorable as prices of key commodities were at multi-year highs. Financial performance and liquidity at agricultural banks remained solid and farm lenders appeared well-positioned to meet higher credit demand through the early months of this year. Farm loan interest rates rose alongside further increases in benchmark rates. The average rate charged on agricultural loans was about 30 basis points higher than the previous quarter and almost 300 basis points higher than a year ago. The farm real estate market has softened as interest rates rose.
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More Reaction to Supreme Court’s Prop 12 Decision
The Supreme Court decision upholding California’s Prop 12 continues to draw strong reactions from America’s agricultural stakeholders. Kansas Republican Senator Roger Marshall says he’s disappointed in the Court’s decision not to strike down Prop 12. “We can’t allow radical state laws to dictate the agricultural practices in every other state,” Marshall says. “This will only increase food costs for people already suffering from food insecurity and drive farmers and ranchers out of business.” Marshall plans to re-introduce his Exposing Agricultural Trade Suppression Act which will prohibit state and local governments from interfering with agricultural production in other states. Iowa’s Ag Secretary Mike Naig says this decision opens the door for the largest states to dictate laws and regulations to the rest of America. “While the ruling was focused on agriculture, it will certainly creep into other industries,” he says. “It will drive the cost of production and food prices higher.”
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More Elected Officials Concerned About Lack of AM Radio in New Cars
Representatives Mike Gallagher of Wisconsin and Josh Gottheimer of New Jersey sent a bipartisan letter to the Federal Emergency Management Agency regarding the future of AM radio in new vehicles. They expressed concerns over auto makers’ decision to drop AM radio access in the new electric vehicles that will be coming to market. The members talked about the important role that AM radio plays in providing life-saving information to the public. They also asked FEMA to outline what impact this would have on the nation’s Emergency Alert System and what steps the agency is taking to prevent this from happening in future vehicle models. “AM radio has extensive geographic reach, including areas where there’s little cell service or broadband internet access,” they say in the letter. “Given the growth in electric vehicle sales, it’s vital that FEMA makes clear the impact that no AM radios will have on public safety.”
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Industry Groups Want More Biomass-Based Diesel in RFS Volumes
Clean Fuels Alliance America joined four other trade associations in sending a letter to EPA administrator Michael Regan regarding biofuel volumes in the Renewable Fuels Standard. They want the EPA chief to substantially raise the biomass-based diesel and overall advanced biofuel volumes in the RFS for 2023-2025. The letter highlights the need for strong RFS volumes to support the goals of the National Blueprint for Transportation Decarbonization. “Our industries need these fuels to decarbonize air transport, long-haul shipping and trucking, home heating, and to meet the needs of our customers and supply chain partners,” the letter says. “The proposed RFS volumes are simply inconsistent with the investments our industries will make to continue expanding production and commercial availability of these fuels by 2025.” The groups also say in the letter that their industries continue to make significant investments in producing, distributing, and using low-carbon fuels, but more can be done.
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Groups Urge Congress to Reject Increases in Farm Subsidies
A group of taxpayer, agriculture, and environmental organizations held a press conference to urge Congressional leadership to reject attempts to increase reference prices for covered commodities. The National Sustainable Agriculture Coalition was one of the groups who opposed raising the Price Loss Coverage reference prices in the 2023 Farm Bill at a time when gross farm income is higher than ever. “Taxpayer commodity program subsidies were designed as a safety net tool, triggered when necessary, to help protect against unpredictable losses that are a part of farming,” says Billy Hackett, NSAC Policy Specialist. “It’s not an annual entitlement program for the country’s most successful farms. Ten percent of the farms get 70 percent of the subsidies and throwing money at an unsustainable system is no solution.” The other organizations taking part in the press conference included the Environmental Working Group, FreedomWorks, the National Taxpayers Union, Farm Action, and several others.
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