Agriculture Commons^™

Coronavirus Food Assistance Program (Cfap) Payments, Anil Giri, E. Wesley F. Peterson, Sankalp Sharma

Cornhusker Economics

On April 17, 2020, U.S. Secretary of Agriculture Sonny Perdue announced the Coronavirus Food Assistance Program (CFAP), a new program to assist producers and consumers affected by the COVID-19 pandemic (USDA 2020b). CFAP will provide $19 billion in relief to producers and entities throughout the supply chain. This will be done through two programs, Direct Support to Farmers and Ranchers ($16 billion) and USDA Purchase and Distribution ($3 billion) (USDA 2020a). Producers will be paid on actual losses due to decreases in prices and/or disruption of supply chains. On May 19, 2020 USDA announced the details of the CFAP. There …

Impact Of Covid-19 On Demand For Distillers Grains From Livestock Operations, Daniel Gertner, Elliott James Dennis

Cornhusker Economics

Government and industry responses to COVID-19 cases have created a variety of unique situations in the agriculture industry. "Stay-at-home" orders forced consumers to be homebound, increasing the demand for food in grocery stores while reducing the need for food in restaurants. These caused a series of rapidly changing supply and demand conditions along the livestock supply chain. Meat destined for restaurants need to be repacked and reprocessed to make it compatible to sell in grocery stores. Meat packing plants continued to try to process harvest-ready animals, but a growing number of positive cases among plant workers forced idling, reduced plant …

The Impact Of The Covid-19 Crisis On Nebraska's Ethanol Industry, John C. Beghin, Sushant Timalsina

Cornhusker Economics

This article looks at the impact of the pandemic crisis on Nebraska’s ethanol industry. We trace the changes in return margins since the last quarter of 2019 to early May of this year and show the deterioration of these margins and the resulting reduced returns, gross revenues and production reduction induced by the low returns.

Workforce Development In A Post-Covid World: A Grassroots Approach, Cheryl A. Burkhart-Kriesel, Kristina Bayton, Samantha Guenther, Blayne Sharpe

Cornhusker Economics

As the world slowly emerges from COVID 19 both the virus and the lingering effects on the economy will be in the spotlight. There is a real urgency to get businesses up and running and employees working again. Some businesses may be able to "flip a switch" and up to speed while other may need to ramp up more slowly and will only be able to "turn up the dial." In both situations, there are implications for the local workforce and for the community.

North Central Extension Risk Management Education Center, Christine Lockert, Bradley D. Lubben

Cornhusker Economics

Managing through the current economic challenges and accumulating shocks in ag sector will be a major challenge for farmers and ranchers. Educating producers to manage these risks and position their farm or ranch for future growth and success is the fundamental purpose of the Extension Risk Management Education (ERME) program.

Nebraska National Agri-Marketing Association And The Covid-19 Effect, Austin Harthoorn, Rosalee A. Swartz

Cornhusker Economics

The University of Nebraska-Lincoln’s National Agri-Marketing Association (NAMA) student organization is one of more than 30 student chapters across the U.S. and Canada. The objective of the student NAMA on campus is to learn first-hand about the many career opportunities in agri-marketing from professionals in marketing, advertising, communications, promotion, sales, and public relations. As chapter members, students develop valuable personal contacts and working relations with agri-marketing professionals and have meaningful opportunities to develop and practice their managerial skills and leadership abilities.

Economic Impacts Of Food Fraud, Syed Imran Ali Meerza, Konstantinos Giannakas, Amalia Yiannaka

Cornhusker Economics

When you order seafood at a restaurant, do you get what you pay for? Scientists from Oceana, a non-profit marine conservation organization, conducted one of the largest seafood fraud investigations on 1,215 samples from 674 outlets in 21 states of the United States (U.S.) over the period 2010 to 2012.They found that there is, on average, a 33% probability that you do not actually get what you pay for. The share of mislabeled food was (a quite remarkable) 74% for seafood sold in sushi restaurants and 18% of seafood sold in gro-cery stores with mislabeled “red snapper” and “tuna” accounting …

Some Economic Implications Of The Covid-19 Pandemic In Nebraska, John C. Beghin

Cornhusker Economics

It is now clear that the spread, mortality and morbidity impacts of the coronavirus pandemic are sizeable but extremely heterogeneous across multiple dimensions. Geography shows that places with lower human con-centrations (urban/rural divide) and away from main travel axes, such as major interstate highways and in-ternational airports, have a lower incidence of cases. Large urban centers with high human concentrations have been much disproportionally affected and with much higher mortality rates. Age and health status are equally important. Mortality increases dramatically for people 60 years old and older. People with comorbidi-ties (cardiovascular, obesity, diabetes, and others) are much more likely …

Covid-19, Farm Survival And Decision Making, Cory Walters, Jessica Groskopf, Richard Preston

Cornhusker Economics

COVID-19 is causing us to experience events that have always been possible, just not yet observed. For farmers these events may have a big negative financial impact, or they may not. The impact on each individual farm has to do with how that individual farm has prepared for rare financially devastating events. Preparing for unseen events represents a logical approach. We call this approach stress testing. Just because you have not seen an event, it does not mean it does not exist. Or said another way, absence of evidence is not evidence of absence. In this article, we discuss how …

2020 Cares Act – Financial Supports For Small Business, Marilyn R. Schlake

Cornhusker Economics

Whether a business is impacted by weather-related disasters, road construction or sudden economic downturns, having a plan to mitigate the impacts can be crucial to the immediate and long-term survival of the business. Unforeseen circumstances, such as the COVID-19 pandemic, may require owners to re-evaluate their business models, cut operating costs and seek outside financial supports – all to keep cash flowing and the business open. To help small businesses during the pandemic, the Coronavirus Aid Relief, and Economic Security (CARES) Act was signed into law on March 27. It contains $349 billion in relief for American small businesses and …

2020 Cares Act – Apoyo Financiero Para Pequeñas Empresas, Marilyn R. Schlake, Sandra Barrera

Cornhusker Economics

Ya sea que un negocio se vea afectado por desastres relacionados con el clima, la construcción de carreteras o las recesiones económicas repentinas, tener un plan para mitigar los impactos puede ser crucial para la supervivencia inmediata y a largo plazo del negocio. Circunstancias imprevistas, como la pandemia de COVID-19, pueden requerir que los propietarios reevalúen sus modelos de negocios, reduzcan los costos operativos y busquen apoyos financieros externos, todo para mantener el flujo de efectivo y abrir el negocio. Para ayudar a las pequeñas empresas durante la pandemia, el 27 de marzo se promulgó la Ley de Ayuda y …

Examining The Role Of The Crop Insurance Selling Agent, Nathan Delay, Hayley Chouinard, Cory Walters, Philip Wandschneider

Cornhusker Economics

The United States Department of Agriculture, Risk Management Agency (RMA) partners with private insurance companies to deliver the federal crop insurance program through agents who sell policies directly to producers. The government subsidizes producers in the form of premium discounts and reimburses private insurance companies for administrative and operating (A&O) costs. The government provides further assistance to the industry by offering a cooperative reinsurance agreement that reduces loss exposure for insurance companies (Appel and Borba, 2009).

Subsidization of private market players may facilitate rent-seeking behavior—efforts to capture larger shares of tax dollars devoted to the program— especially in the settings …

Nebraska Women In Agriculture Celebrating 35 Years, Jessica Groskopf

Cornhusker Economics

A crowd of almost 300 gathered together February 20 and 21 in Kearney, Nebraska for the Nebraska Women in Agriculture conference, with the theme — Celebrating 35 Years! The conference is one of the longest-running women's conferences of its kind in the country. The goal of the Nebraska Women in Agriculture Conference is for women to build relationships with each other while gaining valuable knowledge about managing risk on their farms and ranches. The event featured 5 general session speakers and 35 workshop sessions.

Nebraska Cooperative Development Center Announces Mini-Grant Funding, Charlotte Narjes

Cornhusker Economics

Since 1999, the Nebraska Cooperative Development Center (NCDC) has provided technical assistance, education and training to groups who are developing or are considering the development of a cooperatively owned business. The primary objective is to improve the economic condition of rural areas through cooperative business development.

Nebraska Farm Real Estate Values Improve Despite Uncertainty In 2020, Jim Jansen, Jeffrey Stokes

Cornhusker Economics

The market value of agricultural land in Nebraska increased by three percent over the prior year to an average of $2,730 per acre according to the 2020 Nebraska Farm Real Estate Market Survey (Figure 1 and Table 1). This improvement provides the first increase in the market value of agricultural land in Nebraska since peaking in 2014 at $3,315 per acre followed by a 20 per- cent decline extending to 2019.

The University of Nebraska-Lincoln, Department of Agricultural Economics annually surveys land industry professionals across Nebraska including appraisers, farm and ranch managers, and agricultural bankers. Results from the survey are …

Safety First Risk Preferences And Post-Harvest Grain Marketing A Context-Rich Lab Experiment, Stamatina Stamatina, Simanti Banerjee, Cory Walters

Cornhusker Economics

Improving our understanding of the influence of risk- preferences on decision making represents an important objective for understanding behavior, designing policy and decision making theory. A natural place this problem persists is in the marketing of grain (Kastens and Dhuyvetter, 1999). Grain marketing research has primarily focused on the use of different marketing techniques that result in lower price risk and, therefore, lower-income risk (Musser, Patrick, Eckman, 1996). However, the extent to which the theoretical findings from these studies are relevant to real-world applications is not clear (Brorsen and Irwin, 1996; Garcia and Leuthold, 2004). While reducing income risk is …

2020 Nebraska Property Tax Issues, J. David Aiken

Cornhusker Economics

Nebraska property taxes are the ninth highest in the United States. Nebraska ranks 41st in terms of property taxes (a smaller number means lower property taxes, while a higher number means high- er property taxes). By comparison, Missouri ranks 7th, Colorado is 14th, Kansas is 20th, South Dako- ta is 22nd, Iowa is 35th, and Wyoming is 39th. So Nebraska property taxes are high both regionally and nationally.

Nebraska sales taxes are the ninth-lowest, and both state income taxes and total state taxes are in the middle. Property taxes account for 38% of total state and local tax collections in …

Three Profit Fundamentals Of Agricultural Production, Matthew Stockton

Cornhusker Economics

There is nothing magical or mythical about making a profit. Each ranch/farm business has unique challenges and complexities. This fact makes it easy for operators to become overwhelmed or distracted from the fundamental factors that drive profitability. Each decision made in the farm or ranch business has an impact on profitability through one of three fundamental paths- cost, revenue and their common link productivity. As a result of being involved in the University of Nebraska Testing Ag Performance Solutions (UNL-TAPS) competition in North Platte for the last several years, I have observed some very striking factors that have helped teams …

2020 Nebraska Crop Budgets Review, Glennis Mcclure

Cornhusker Economics

For the 2020 production year, 82 budgets for 15 crops including 2 cover crops are available from the University of Nebraska-Lincoln and the Department of Agricultural Economics. The budgets are published online in two formats including a printable pdf file version and an Excel file version. cropwatch.unl.edu/budgets

Information on crop budgeting procedures, machinery operation and ownership costs, material and service prices, and a crop budget production cost summary is included in the format of each budget. Two new irrigated corn budgets, Numbers 33 and 34, and two new soybean budgets, Numbers 64 and 65, were added for 2020, which reflect …

Nebraska Agricultural Machinery And Equipment Sales Tax Exemption, Austin Duerfeldt

Cornhusker Economics

Nebraska sales and use tax for farmers and ranchers can be a difficult subject. When purchasing or leasing depreciable agricultural machinery and equipment for commercial agricultural use those purchases are listed as exempt from Nebraska and local sales and use taxes. The purchase of a 200- horsepower tractor or a new 12-row planter often is the first to come to mind when thinking of assets that fall into that category. The question that often arises though is what about other items such as a seed tender, auger wagon, or skid steer? For that answer you have to do research on …

Internships In Nebraska Agricultural Cooperatives, Greg Mckee

Cornhusker Economics

Agricultural cooperatives are prominent employers across Nebraska. Several have developed internship programs. Cooperatives recruit interns to attract fulltime position applicants, to expose interns to various aspects of the cooperative business model as well as addressing short term labor needs. Students participate in internships to develop skills for career planning.

Nebraska agricultural cooperatives offered approximately one 100 internships in 2019. The number of cooperatives offering internships is increasing; at least two offered internships for the first time last year. Others are looking to strengthen their existing programs.

Internship program design varies across cooperatives. Relatively small agricultural cooperatives provide an overall work …

Comparison Of 2018 And 2019 Market Facilitation Program Payments For Nebraska Producers, Anil Giri, E. Wesley F. Peterson, Sankalp Sharma

Cornhusker Economics

In a previous issue of Cornhusker Economics ( October 3, 2018, available at https://agecon.unl.edu/ cornhusker-economics/2018/market-facilitationprogram) we reviewed the sequence of events surrounding the trade war between the United States and China, and, in particular, the response of the Trump administration to the retaliatory tariffs imposed by China on soybeans and other agricultural commodities. The Market Facilitation Program (MFP) has been the main mechanism for compensating farmers for losses associated with the trade war. In the past year, there have been several important changes related to these events:

1. On January 15, 2020, the first phase of a trade deal between …

How Emotions Affect Farm And Ranch Succession, Allan Vyhnalek

Cornhusker Economics

Whenever a family has a discussion about agricultural estate planning, conversations can become emotionally charged. Stakes can be high and feelings can be hurt just by using the wrong words in a sentence. If things go south and parties are upset, they will likely withdraw from the dialogue or leave the gathering altogether.

When communications or negotiations break down, one way to help is to think about the five emotional blocks that need to be overcome if possible. They are: appreciation, affiliation, autonomy, status and role. Let's examine each to see how these blockages can interfere with a family moving …

Celebrating 25 Years Of The Nebraska Rural Poll, Rebecca J. Vogt

Cornhusker Economics

In 2020, the 25th annual Nebraska Rural Poll will arrive in mailboxes across the state. For 25 years, the Poll has examined many topics of concern to rural Nebraskans and accumulated a rich dataset for state and community leaders.

The Nebraska Rural Poll was first conducted by the University of Nebraska-Lincoln Department of Agricultural Economics in 1996 under the leadership of Dr. John Allen and Dr. Sam Cordes. Each year since, 7,000 surveys are mailed to randomly selected households located in the nonmetropolitan counties of the state. The goal of the poll is to give rural Nebraskans and their leaders …

Representative Economic Budgets For Nebraska Cow Herds, Glennis Mcclure, Jay Parsons

Cornhusker Economics

In 2017, the University of Nebraska-Lincoln Institute of Agricultural and Natural Resources (IANR) and Nebraska Extension made a commitment to implement a multidisciplinary Beef Systems Initiative (BSI). BSI is administered by the Center for Grassland Studies and is comprised of six projects designed to develop and support implementation of beef production systems that optimize feed resource use, natural resource conservation, and producer success in Nebraska through improved management of perennial grasslands and systems of integrated crop-beef cattle production. In addition to BSI, a parallel project funded by the Foundation for Food and Agriculture Research (FFAR) is studying the best practices …

Accrual Accounting And The Farm Business, Part Ii, Timothy Meyer

Cornhusker Economics

My last Cornhusker Economics article, Accounting Assumptions and the Farm Business (October 16, 2019) set the foundation for a specific evaluation of the conceptual framework accrual accounting offers the farm or ranch manager. The article addressed cash accounting and hinted at its shortfalls which were rectified by accrual accounting. This article will explain conceptual frameworks, and two accrual accounting principles; namely the revenue recognition principle and the matching principle.

During one of my graduate school experiences, I encountered a professor who seemed to be in love with conceptual frameworks. I chose a framework and tried to use it as instructed, …

The Impact Of Veterans Treatment Courts On The Community, Daniela Mettos, Amanda Leingang

Cornhusker Economics

With the United States’ ongoing presence in the Middle East and the ever-present possibility of future conflict, the commitment to tend to the unique needs of veterans returning from combat is an essential one. The number of veterans suffering from mental health issues, substance abuse disorders, and physical trauma continues to rise. With this comes an increased risk of Intimate Partner Violence (IPV), drug and alcohol abuse, and repeating criminal behavior, all of which increase the likelihood that veterans will find themselves involved in the criminal justice system at some point following their combat service.

Utilizing effective, reliable, and focused …

Further Thoughts On The Brazilian Grain Market, Its Competitiveness And Its Challenges, Fabio Mattos

Cornhusker Economics

In previous articles in this space (on 6/20/2018 and 6/19/2019), I talked about recent developments and challenges for Brazilian grain markets. We discussed that one of the main obstacles for Brazilian competitiveness is the country’s logistics system. In those articles, we focused more on transportation and how higher marketing costs are explained by the poor infrastructure in Brazil and the modes of transportation used to haul grain to export ports. Today we will talk a bit more about this point, and then address another dimension of the logistics challenge in Brazil.

As previously discussed, the major agricultural area in Brazil …

Effects Of Irrigation And Climate On The High Plains Aquifer, Richard K. Perrin, Felipe Silva, Lilyan E. Fulginiti, Karina A. Schoengold

Cornhusker Economics

The High Plains Aquifer (HPA), sometimes known in Nebraska as the Ogallala Aquifer, is an enormous resource underlying 112 million acres across parts of eight states, from South Dakota to Texas.

Our research has previously estimated that irrigation water drawn from the HPA adds at least $2 billion worth of additional crops per year in Nebraska alone, and $3.5 billion across the entire HPA1.

In the years ahead, world population growth will surely increase the pressure for irrigation from the stock of water in the HPA. But pumping that water from the aquifer can increase the depth to groundwater which …

Appraisal Or Evaluation? The Impact Of Cap Rates On Financing, Jeff Stokes

Cornhusker Economics

Loan underwriting has long been a crucial function of financial institutions. The C’s of credit (character, capacity, capital, conditions and collateral) are taught in many college-level finance and banking courses and the process is even mentioned in popular movies such as “It’s a Wonderful Life.” The process is also recognized as being costly in terms of time and money. Regulations are promulgated and enforced to assure the safety and soundness of lending institutions. Nevertheless, there are situations when the risk to safety and soundness are so small that less extensive underwriting procedures may be appropriate. Benefits to lenders and borrowers …