Agricultural and Resource Economics Commons^™

Nebraska Leads In Irrigated Land, Bruce B. Johnson, Ryan Lukassen

Cornhusker Economics

Nebraska is #1. According to the most recent U.S. 2007 Census of Agriculture (released in February of this year), Nebraska now has more irrigated farmland than any other state. It is common knowledge to observers of our agricultural economy that our state has been in an irrigation expansion mode for several years. But what may be surprising to many is that simultaneously, other major irrigation areas of the country have witnessed reduced irrigated acreage.

Weather Derivatives As A Potential Risk Management Tool For Irrigators, Ray Supalla, Christopher L. Thompson, Brooks Neely

Cornhusker Economics

Irrigators in the Republican Basin and in parts of the North Platte Basin must learn to incorporate multiple year drought risk into their management plans, as they adapt to the limitations imposed by five-year pumping allocations. A major concern involves the implications of being water-short during the later years of the allocation period, because of an accumulative rainfall shortage or drought. Currently, producers can either ignore the risk of substantially lower incomes if their allocation is exhausted too soon, or reduce the risk by using less water early in the allocation period. The latter approach, however, may substantially reduce the …

Nebraska Farm Real Estate Market Developments 2008–2009, Bruce B. Johnson, Ryan Lukassen

Department of Agricultural Economics: Faculty Publications

Following strong value advances over the past several years, Nebraska farmland values throttled down and stabilized across most of the state during the 12-month period ending February 1, 2009. According the 2009 UNL Nebraska Farm Real Estate Survey, the average all-land value rose just over 1% for the year. Some modest decreases in value were reported for some classes of land, but relative to recent trends for residential and commercial property across the U.S., stable values for agricultural land speaks to its relative strength in the current recession.

Regional differences in value shifts were rather significant over the time period. …

Evaluating The Edge: What Are The Impacts?, Marilyn Schlake

Cornhusker Economics

In 2008, the Center for Applied Rural Innovation conducted a comprehensive five-year evaluative study of the NebraskaEDGE program. Two different surveys were sent to former NebraskaEDGE training participants who were enrolled in the EDGE training courses between the Fall of 2002 and Spring of 2007. The objective of the surveys were to: 1) measure changes in participant knowledge and skills as a result of the entrepreneurial training class, and 2) better learn how participants applied their new skills to their businesses and what those impacts were on the businesses.

North Central Risk Management Education Center, Cheryl Griffith

Cornhusker Economics

The North Central Risk Management Education Center has been providing program coordination for extension risk management education in the North Central Region since 2001. During this time, nearly five million dollars has been awarded to public, private and non-profit entities to carry out producer-focused, results-based risk management education programs. The North Central Region includes Illinois, Indiana, Iowa, Kansas, Michigan, Minnesota, Missouri, Nebraska, Ohio, North Dakota, South Dakota and Wisconsin.

Never Let A Crisis Go To Waste, Cheryl A. Burkhart-Kriesel

Cornhusker Economics

The phrase, “never let a crisis go to waste” may take frugality to a whole new level! That’s the sentiment of Lynda Applegate, Professor of Business Administration at the Harvard Business School, in a recent on-line article, Building Businesses in Turbulent Times.

Nebraska Nama Big Xii Champs!, Karoline Kastanek, Rosalee A. Swartz, Lance Brown

Cornhusker Economics

The University of Nebraska-Lincoln National Agri-Marketing Association (NAMA) Marketing Team brought home the Big XII Championship as a national finalist at the 2009 NAMA Annual Conference held April 14-17 in Atlanta, Georgia.

Department Of Agricultural Economics Publications In 2008

Department of Agricultural Economics: Faculty Publications

Annual Department of Agricultural Economics Faculty Publication List (for 2008)

Who Suffers Most When Disease Outbreaks And Food Recalls Happen? The Case Of Mad Cow Disease In The United States, Sunil P. Dhoubhadel, Matthew Stockton

Cornhusker Economics

It is generally observed that whenever there are cases of disease outbreaks and food recalls, such as the case of the 2003 Mad Cow Disease (Bovine Spongiform Encephalopathy or BSE) outbreak, cattle and beef prices fall. Given these incidents, there is the question of which part of the marketing chain is the most affected. For those who produce live cattle, such as feedlot operators, the question is ‘what effect these events have on price and demand for beef and cattle?’ Similarly, how do the Food Safety Inspection Service (FSIS) recalls and diseases such as Mad Cow Disease outbreaks affect the …

Nrd Plans For “Not-Quite” Fully-Appropriated Basins, J. David Aiken

Cornhusker Economics

On April 8, 2009, the Nebraska Department of Natural Resources (DNR) determined that the Lower Platte River Basin was not yet fully-appropriated. On April 6, Nebraska Governor Heineman signed Legislative Bill (LB) 483, which established procedures to limit new irrigation development in areas like the Lower Platte Basin. Last week’s newsletter (April 15), discussed how LB483 requires the 14 affected natural resource districts (NRDs) to prepare plans to limit new high-capacity wells, in order to maintain the basin’s not fully-appropriated status. This week’s newsletter discusses how the LB483 NRDs might propose to limit new irrigation wells.

Has The Ethanol Industry Impacted Nebraska Land Values?, Ben Blomendahl, Bruce B. Johnson

Cornhusker Economics

The growth of the United States ethanol industry has been quite extensive, especially in Nebraska, where production has grown from 523 million gallons per year in 2005, to 1,115 million gallons per year in 2008 (Nebraska Energy Office, 2009). Rural areas are at an advantage for attracting ethanol plants, as prospective plants want to locate as close as possible to its chief resource - corn. In exchange for locating near its feedstock, ethanol plants offer higher prices in the competition for corn, which in turn has impacted farm income. Surprisingly, little research has been done with regards to an ethanol …

Grain Storage Costs And Rental Rates, Ross Miller, H. Douglas Jose

Cornhusker Economics

Trends in Grain Storage - Commercial grain storage eliminates the need to monitor grain conditions and, hence, offers the peace of mind that unsold grain will remain in condition. There may be a cost trade-off between this reduced storage risk and the cost of on-farm storage.

Nebraska Farmland Markets Plateau, Bruce B. Johnson, Ryan Lukassen

Cornhusker Economics

After several years of successively rising land values and cash rents, Nebraska’s farmland markets throttled back during 2008. Preliminary results from the University of Nebraska-Lincoln’s 2009 Nebraska Farm Real Estate Market Survey show a clear picture of the market mood turning very cautious in response to the U.S. and global economic downturns. As of February 1, 2009, the weighted average value of Nebraska farmland was $1,424 per acre, identical to the year-earlier level (Figure 1 and Table 1 at end of article). Likewise, estimated 2009 cash rents are stable to slightly down from 2008 levels throughout most of the state.

Economy Hard On Beef And Pork Demand, Darrell R. Mark

Cornhusker Economics

The inventory of all cattle and calves reached a 50-year low at the end of 2008. Pork producers reduced the size of the breeding herd late in 2008. Imports of feeder cattle, feeder pigs and slaughter cattle and hogs from Canada have dropped dramatically since the fourth quarter of 2008. And, never before seen drops in broiler production occurred in the last few months of 2008. With production of nearly all sectors of the meat industry lower than year-ago levels, why haven’t livestock prices rallied in response? The economic times we’re in have reduced demand. People haven’t been willing or …

Analyzing The Acre Program, Bradley D. Lubben

Cornhusker Economics

The new farm bill enacted by Congress in June 2008 includes a new revenue-based safety net, the Average Crop Revenue Election (ACRE) Program, that is available to producers beginning with the 2009 crop year. While final details and implementation of the program is yet to be announced by the USDA Farm Service Agency (FSA), an analysis of the mechanics of ACRE and the relevant yields and prices to include in ACRE can help producers assess whether ACRE will be a good choice for this crop year and beyond.

Cultivating Dreams - Harvesting Profits, Women In Agriculture 2009, Megan Voss, Paige Bek, Maggie Holub

Cornhusker Economics

The University of Nebraska!Lincoln Department of Agricultural Economics hosted the 24th Women in Agriculture (WIA) Conference February 26-27, 2009. Over 350 women participated in the event. A majority came from across the great state of Nebraska, but there were a few individuals that made the trip from California, Colorado, North Carolina, Kansas, Iowa and South Dakota. For some women, this was their first time experiencing the conference and for others it was their 24th time. Average attendance among the women was approximately 6.5 times. The main goal of the conference was to heighten the womens’ skills and gain knowledge to …

The Impact Of Weather Extremes On Agricultural Production Methods: Does Drought Increase Adoption Of Conservation Tillage Practices?, Ya Ding, Karina Schoengold, Tsegaye Tadesse

Department of Agricultural Economics: Faculty Publications

One benefit of conservation tillage practices is an increase in soil moisture. The paper combines panel data techniques with spatial analysis to measure the impact of extreme weather events on the adoption of conservation tillage. Zellner’s SUR technique is extended to spatial panel data to correct for cross-sectional heterogeneity, spatial autocorrelation, and contemporaneous correlation. Panel data allows the identification of differences in adoption rates as a function of the severity of past drought or flood events. The adoption of no-till, alternative conservation tillage, and reduced till are estimated relative to conventional tillage. Extremely dry conditions in recent years are found …

“I Don’T Want To Be Selling My Soul”: Two Experiments In Environmental Economics, Natalia V. Ovchinnikova, Hans J. Czap, Gary D. Lynne, Christopher W. Larimer

Department of Agricultural Economics: Faculty Publications

We conducted two experiments in the context of environmental protection. We found that profit considerations and personality traits are among the essential determinants of individual contributions to the solution of environmental problems. The results show that environmental considerations are powerful motivators and subjects are willing to forgo pecuniary profits for the sake of “doing-the-right-thing”. The study shows that the environmental groups can purchase carbon offsets directly from the providers at a lower-than market price and still obtain a relatively large market share.

Is Corn Ethanol Economically Viable In The Long-Run?, Richard K. Perrin

Department of Agricultural Economics: Faculty Publications

The corn ethanol industry is in the pits, with plants being idled and firms declaring bankruptcy. Not only that, but each month seems to bring a new study assailing corn ethanol because it doesn’t help the environment, or it doesn’t reduce dependence on foreign oil, or it drives up food prices, or it is harmful to health.

These assertions each have some basis, and they have gone far to undermine public policies in support of corn ethanol. So what then is the future for the industry? Can it survive without mandates and subsidies? To answer, we must first look at …

Is Corn Ethanol Economically Viable In The Long Run?, Richard K. Perrin

Cornhusker Economics

The corn ethanol industry is in the pits, with plants being idled and firms declaring bankruptcy. Not only that, but each month seems to bring a new study assailing corn ethanol because it doesn’t help the environment, or it doesn’t reduce dependence on foreign oil, or it drives up food prices, or it is harmful to health.

Using Nebraska’S Beginning Farmer Tax Credit Program, David J. Goeller

Cornhusker Economics

Many farm or ranch families that are attempting to bring a son or daughter back into their business experience a strain on the cash flow. After all, a business that has been providing enough income for one family to live on, must now not only generate adequate income for the parents living expenses, but also attempt to provide enough income for a second family, the successor. Recent changes to Nebraska’s Beginning Farmer Tax Credit Program provide an attractive incentive that can be very beneficial for family farming/ranching operations that are trying to bring a family member back into their business. …

Efficiency In Midwest Us Corn Ethanol Plants: A Plant Survey, Richard K. Perrin, Nickolas F. Fretes, Juan P. Sesmero

Department of Agricultural Economics: Faculty Publications

Continuation of policy support for the US corn ethanol industry is being debated due to doubts about the greenhouse gas effects of the industry and the effects of the industry on food prices. Yet there is no publicly available data on the economic and technical performance of the current generation of plants, which constitute the overwhelming majority of the industry. This study helps to fill that gap. Seven recently constructed ethanol plants in seven Midwest US states provided details on input requirements and operating costs during 2006 and 2007. Results show that technical performance is substantially better than current estimates …

The California Global Warming Solutions Act Of 2006:The 2009 United States Global Warming Act?, J. David Aiken

Cornhusker Economics

Greenhouse gas (GHG) emissions trap solar heat in the atmosphere, increasing global temperature by an estimated 1.4 degrees. Increases in global GHG emissions, resulting largely from increasing global energy use, have led to more heat being trapped in the atmosphere, leading to global warming. Major impacts of global warming include rising sea levels, higher temperatures and increased global migration of disease-carrying insects.

While there is continuing scientific discussion regarding how quickly the earth’s atmosphere will warm and when the adverse global warming impacts will occur, most scientists believe that GHG emissions must be reduced 50-80 percent in the next 50 …

Empathy Conditioned Conservation: "Walking-In-The-Shoes-Of-Others" As A Conservation Farmer, Robert Sheeder, Gary D. Lynne

Department of Agricultural Economics: Faculty Publications

Since the destruction and despair caused by the dust bowl of the 1930’s, Americans and their government have taken a keen interest in natural resource conservation policy on agricultural land throughout the country. As a reflection of this, the farm bill of 1936 entitled the “Soil Conservation and Domestic Allotment Act” included for the first time provisions that provided payments and support to farmers willing to employ soil conservation measures on their farms (Cain and Lovejoy, 2004). While the main purpose of this bill was to provide financial support to impoverished farmers dealing with low commodity prices, the fact remains …

Atlas Of Sorghum (Sorghum Bicolor (L.) Moench): Production In Eastern And Southern Africa, Charles S. Wortmann, Martha Mamo, Christopher Mburu, Elias Letayo, Girma Abebe, Kaizzi C. Kayuki, Medson Chisi, Munyaradzi Mativavarira, Soares Xerinda, Theophile Ndacyayisenga

INTSORMIL Scientific Publications

Grain sorghum (Sorghum bicolor (L.) Moench) is a major crop in many parts of Africa and is noted for its versatility and diversity. It is adapted over a wide range of precipitation and temperature levels and is produced at sea level to above 2000 m altitude. In eastern and southern Africa, it is primarily a crop of resource-poor, small-scale farmers and is typically produced under adverse conditions such as low input use and marginal lands. There are numerous biotic and abiotic constraints to production. The grain and stover are used in many different ways with localized preferences. Much information …

How Coupled Are Decoupled Farm Payments? A Review Of The Evidence, Arathi Bhaskar, John C. Beghin

Department of Agricultural Economics: Faculty Publications

This survey paper explores the literature on decoupling of farm programs that has emerged in the last 10 years. The paper identifies and assesses the various channels of potential coupling of decoupled farm payments and provides a taxonomy of coupling mechanisms found in theoretical and empirical papers. Coupling of decoupled payments is pervasive but effects when measurable are small, with the exception of the impact on land values. The paper points to unresolved issues on potential coupling mechanisms for further research.

Domestic subsidies to agriculture were brought under the discipline of global trade rules for the first time in the …

Nebraska Farm Real Estate Market Developments 2008-2009, Bruce B. Johnson, Ryan Lukassen

Department of Agricultural Economics: Faculty Publications

Following strong value advances over the past several years, Nebraska farmland values throttled down and stabilized across most of the state during the 12-month period ending February 1, 2009. According the 2009 UNL Nebraska Farm Real Estate Survey, the average all-land value rose just over 1% for the year. Some modest decreases in value were reported for some classes of land, but relative to recent trends for residential and commercial property across the U.S., stable values for agricultural land speaks to its relative strength in the current recession.

Regional differences in value shifts were rather significant over the time period. …

Nebraska Farm Real Estate Market Developments 2008-2009, Bruce B. Johnson, Ryan Lukassen

Nebraska Farm Real Estate Reports

Following strong value advances over the past several years, Nebraska farmland values throttled down and stabilized across most of the state during the 12-month period ending February 1, 2009. According the 2009 UNL Nebraska Farm Real Estate Survey, the average all-land value rose just over 1% for the year. Some modest decreases in value were reported for some classes of land, but relative to recent trends for residential and commercial property across the U.S., stable values for agricultural land speaks to its relative strength in the current recession.

Regional differences in value shifts were rather significant over the time period. …

Pricing And Welfare Impacts Of New Crop Traits: The Role Of Iprs And Coase's Conjecture Revisited, Richard K. Perrin, Lilyan E. Fulginiti

Department of Agricultural Economics: Faculty Publications

Crop traits are durable when embedded in varieties, and thus they may be subject to Coase's conjecture that monopolists who sell durables may be unable to earn normal monopoly rents, or in the extreme case, not any rents at all. To determine the potential relevance of this conjecture for the crop traits market, we analyze the theoretical time path of trait prices under three systems of intellectual property rights (utility patents, plant breeders' rights, and none), alternative assumptions about sellers' ability to commit to future action, and alternative assumptions that buyers are either myopic or far-sighted with respect to expectations …

Planning Your Business In The Volatile Economy Of 2009, Doug Jose

Cornhusker Economics

Planning what to grow in 2009 has many complications this year. Among the possible unknowns at the farm level are market prices for commodities, the cost and availability of inputs and the cost and availability of operating credit. I say “possible” because through contractual arrangements and forward pricing decisions you may already have locked in many of these prices for the next production cycle. Then there are a number of general economic situations which will impact agriculture. The financial recovery both here and worldwide is critical. Agriculture needs improvement in our general economy and improved consumer confidence in order to …