NATIONAL AG NEWS SPONSORED BY THE AMERICAN FARM BUREAU FEDERATION
National Ag News for September 12, 2023
Ag Labor Expenses Forecast to Increase in 2023
Total cash labor expenses for the U.S. agriculture sector are forecast to be $43.35 billion for 2023, based on new data from USDA’s Economic Research Service. This would be an increase of $0.78 billion, or 1.8 percent, over the 2022 level of $42.57 billion in inflation-adjusted 2023 dollars. The projected 2023 level would remain below the high set in 2017. Labor expenses are an important component of agricultural production costs. For every $100 spent on production expenses, almost $10 goes toward labor. Total labor expenses include contract and hired labor payments but exclude non-cash employee compensation. Generally, the animal production sector uses less hired and contract labor than the crop sector. In 2021, the animal production sector accounted for about one-third of total hired and contract labor expenses, with the remaining roughly two-thirds incurred by the crop production sector. This is because some large specialty crops are more labor-intensive than most industries in the animal sector.
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NMPF Applauds Natural Disaster Assistance for Dairy Farmers
New funding announced Monday from the Department of Agriculture will help dairy producers affected by natural disasters. The Milk Loss Program administered by the Farm Service Agency will compensate eligible dairy farms and processors for milk dumped due to qualifying disaster events from 2020 to 2022. Eligible disasters include droughts, wildfires, hurricanes, floods, derechos, excessive heat, winter storms and smoke exposure. The Milk Loss Program will help farmers and, in certain cases, cooperatives, recover losses previously overlooked by disaster assistance. The National Milk Producers Federation applauded the announcement. NMPF president and CEO Jim Mulhern says, “We’re very appreciative of USDA’s diligent work over several months to finalize the compensation plan that will address this backlog of disaster assistance.” Dairy farmers and cooperatives can sign up for the program through October 16, 2023. In other FSA dairy safety-net support, Dairy Margin Coverage program payments have triggered every month, January through July, for producers who obtained coverage for the 2023 program year.
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TFI Welcomes STB’s Proposed Rule on Reciprocal Switching
The Fertilizer Institute praised the Surface Transportation Board’s recent Notice of Proposed Rulemaking on providing rail customers access to reciprocal switching as a remedy for poor rail service. STB Chairman Martin Oberman stated in the announcement, “In the past several years, and particularly since 2021, it has become clear that many rail customers nationwide have suffered from inadequate and deteriorating rail service.” The proposal from the STB would provide a streamlined path for rail customers to obtain a reciprocal switching order by including specific, objective, and measurable criteria for determining eligibility. That criterion includes measures of service reliability, service consistency, and adequacy of local service. The proposal would also standardize these three service metrics across all Class 1 carriers for the first time. President and CEO Corey Rosenbusch says, “More than 60 percent of fertilizer moves by rail and is therefore critical to the on-time delivery of fertilizer to farmers exactly where and when they need it.”
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AEM: Market Challenges Lie Ahead, But Optimism is Warranted
As equipment manufacturers look ahead to the remainder of 2023 and beyond, the landscape continues to present challenges for the industry and the ag and construction customers it serves. AEM members report demand for products across both industries has softened. However, particularly in construction, investments in infrastructure, energy and utilities, point to better days ahead. And a wealth of data suggests optimism – both in the short term and long term. AEM Director of Agriculture Austin Gellings says, “Essentially, everything hinges on where a farmer is going to be able to improve their efficiency the most and in turn see the greatest return on investment.” With input costs continuing to rise, the best ways for a farmer to respond and continue to reap the rewards of strong commodity prices is to operate on those margins and find wins where they can. As farmers are looking for ways to minimize inputs while still increasing yields, technology and data provides the answer.
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NASDA Foundation welcomes Next Generation class of 2023
The National Association of State Departments of Agriculture Foundation welcomes NASDA’s Next Generation class of 2023, featuring 13 students from ten states. The NASDA Next Generation class of 2023 will network with commissioners, secretaries and directors of agriculture, industry leaders, and stakeholders at the NASDA Annual Meeting. The program aims to advance future leaders’ understanding of agriculture policy and the role of state departments of agriculture in ensuring a healthy and thriving food system for all. Through the NASDA Next Generation programming, students learn about pressing food and agricultural policy issues, NASDA’s mission, and careers in public service. During the meeting events, students can also explore Wyoming’s community-based agriculture. NASDA CEO Ted McKinney says, “This cohort of students represents the wide variety of experience and dedication to agricultural excellence that will enable the industry to thrive and impact the entire food system moving forward.” You can find the list of students on the NASDA website.
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GasBuddy: Weekly Fuel Prices Rise Again
After falling for two straight weeks, the nation’s average price of gasoline increased, rising 1.6 cents from a week ago to $3.79 per gallon. The national average is down 3.0 cents from a month ago but 11.4 cents per gallon higher than a year ago. The national average diesel price fell 0.9 cents last week to 4.42 per gallon, 58.6 cents lower than one year ago. The West Coast and the Corn Belt saw the brunt of last week’s increases. More than ten states saw prices rise by more than ten cents per gallon compared to last week, while some, like Iowa and Minnesota, have seen average prices spike by over 30 cents per gallon. However, GasBuddy’s Patrick De Haan says, “We should see more price decreases for most of the nation in the weeks ahead, barring further refinery disruptions and hurricane season.” U.S. retail gasoline demand saw a hefty 3.9 percent decrease last week, as post-Labor Day travel appeared to drop significantly.
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