economics

DairyCast 0443 Show Notes:

• Strong balance sheets and a good business plan open lender doors, according to Paul DeBriyn, President and CEO of AgStar Financial.

According to the DairyCo (UK) Milkbench+ report, the relationship between cost of production and profit is much stronger than many dairies realize. The report states that cost of production is the most significant factor in determining profit.

Milkbench+ analyst Karolina Klaskova says: “Through robust data and statistical analysis we see that the relationship between cost of production and margin is strong.” Ms Klaskova acknowledges that the findings are challenging. “The report raises many issues, including just how difficult it can be to make a profit from milk production,” she says.

DairyCast 0440 Show Notes:

• Weather insurance from The Climate Corporation.  Based on conditions in and around the growing season, this risk management tool provides coverage against the biggest unknown in our industry. 

Bob Young, American Farm Bureau's chief economist, is seeing food costs going up through their consumer surveys.

Our surveys' would suggest those food prices are up, and up significantly.

However, there are enough of uncertainties in the market places that suggest that food prices will only be a factor but not the driver.

Other activity in agriculture suggests that the sector as a whole is doing well. There still are issues with corn and bean prices remaining high, with impacts to cattle prices. But over all 2012 looks pretty good.

DairyCast 0439 Show Notes:

• Food prices are higher and the consumer (Black Friday sales notwithstanding) are hunkering down.  What does it mean for U.S. agriculture and agricultural policy?  Let's ask American Farm Bureau Federation chief economist Bob Young.

DairyCast 0438 Show Notes:

• Dr. Marty Strauss, a consultant with Kahn Strauss and Associates was a speaker and panelist at the recent Food Systems Summit where discussion focused on creatively communicating what today's agriculture provides; food safety, low cost, convenience, etc.  I asked Dr Strauss how to better bridge that gap when today's consumer doesn't really understand what they're getting and why. 

DairyCast 0432 Show Notes:

• Recently signed Free Trade Agreements with U.S. trading partners, especially South Korea, appear especially bullish for ag exports.  K State economist Glynn Tonsor reports on research funded by the U.S. Meat Export Federation on just how big a bonanza it could be.

Charlie Arnot, The Center for Food Integrity, provides an overview of the Food System Summit program October 25-26, 2011 in Chicago. Dr. Jason Clay, Senior Vice President, Market Transformations with the World Wildlife Fund, will present a keynote address during the Summit; Jim Moseley, Co-Chair, AGree Transforming Food & Ag Policy, will be the featured speaker; and Joe Quinn, Senior Director, Issue Management and Strategic Outreach for Walmart Corporate Affairs, will provide the closing keynote address.

Forage / hay quality and availability is tight this year. Many operations are facing tough decisions on acquiring feed options. If you are faced with using lower quality forage or hay, this post will help in identifying the quality and storage options for fall and winter.

The quality of the hay will vary greatly, depending on the time of year, maturity and weather conditions when the hay was made in addition to how it is stored. While we encourage forage testing as the only real way of knowing the feed value of your hay, very few farmers are following through with this practice.