Agricultural and Resource Economics Commons^™

Net Energy Of Cellulosic Ethanol From Switchgrass, Marty R. Schmer, Kenneth P. Vogel, Robert B. Mitchell, Richard K. Perrin

Department of Agricultural Economics: Faculty Publications

Perennial herbaceous plants such as switchgrass (Panicum virgatum L.) are being evaluated as cellulosic bioenergy crops. Two major concerns have been the net energy efficiency and economic feasibility of switchgrass and similar crops. All previous energy analyses have been based on data from research plots (<5m²) and estimated inputs. We managed switchgrass as a biomass energy crop in field trials of 3–9 ha (1 ha=10,000m²) on marginal cropland on 10 farms across a wide precipitation and temperature gradient in the midcontinental U.S. to determine net energy and economic costs based on known farm inputs …

Managing Global Climate Change An Executive Interview With David Lobell, H. Douglas Jose

Department of Agricultural Economics: Faculty Publications

Many of the world’s poorest regions could face severe crop losses in the next two decades because of climate change, according to Dr. David Lobell, a Senior Research Scholar at Stanford University in the program on Food Security and Environment.

The average world temperature is increasing slightly says Lobell and a one-degree Celsius increase over time greatly impacts climatic growing conditions. Unfortunately, agriculture is also the human enterprise most vulnerable to changes in climate. Understanding where these climate threats will be is central to our efforts in fighting hunger and poverty over the coming decades. Dr. Lobell outlines some of …

Managing Global Climate Change An Executive Interview With Carole Brookins, H. Douglas Jose

Department of Agricultural Economics: Faculty Publications

Carole Brookins is an international consultant known for her work as a policy and trade strategist on issues concerning the global political economy and its effect on the food and agriculture sector. She currently serves on the board of several corporate and non- profit organizations concerned with global food system issues and is currently helping to develop solutions which can offset the effects of global climate change through the reduction and management of carbon emissions—an issue of increasing importance in future food marketing and world trade. Ms. Brookins served as U.S. Executive Director to The World Bank from 2001-2005 and …

Agricultural Systems: Agroecology And Rural Innovations For Development [Book Review], Charles A. Francis

Department of Agronomy and Horticulture: Faculty Publications

To welcome yet another book on sustainable development, a reviewer must look for what is unique and what adds value to the volumes already published. In Agricultural Systems, editors Sieglinde Snapp and Barry Pound have assembled a collection of chapters that goes beyond the usual praise and criticism of the green revolution and the focus on economic development. Their book provides a first-hand story by people with lengthy experiences in the field, especially in Africa, who have developed and tested grassroots, participatory development approaches. The result is a valuable set of principles, strategies and case studies that paint a new …

Local Economic Impacts Of Ethanol Production, David J. Peters

Cornhusker Economics

The ethanol boom has generated an unprecedented amount of industrial investment in many rural communities. However, local governments and economic developers have little reliable information regarding the economic impact of these plants in the community. An assortment of consultants and government agencies, including some universities, has produced a wide range of positive impacts that stretch beyond sound economic theory or method. Communities using these optimistic estimates risk investing scarce tax dollars and resources into ethanol projects that may not produce the full expected economic benefits. Thus, it is worth discussing a reasonable estimate of the likely economic impact of a …

Newcomers To The Nebraska Panhandle: How Do We Keep Them Here?, Cheryl A. Burkhart-Kriesel

Cornhusker Economics

A lot of media attention over the years has been given to the steady decline of population in rural areas across Nebraska. However, there is another side to this story. Research using the 2000 U.S. Census shows that significant numbers of people do move in and out of rural regions within our state. Unfortunately, very little is really known about the new residents’ motivations for moving to the region, and reasons why they choose to remain or consider leaving their new community.

Have You Considered Culling Pairs?, Matthew Stockton, Roger K. Wilson

Cornhusker Economics

Cow-calf producers, like many agricultural producers, make many current decisions that ultimately affect subsequent seasons’ production and income. These decisions not only affect production quantity, but involve cash flow and resource allocation constraints. One of the most difficult and complicated choices ranchers face is the rate and timing of replacing and removing brood cows from the herd. This sentiment was reflected in the statement by B. E. Melton in his December, 1980 article in the Western Journal of Agricultural Economics, “Economics of Beef Cow Culling and Replacement Decisions Under Genetic Progress.” He wrote, “Probably no single aspect of modern beef …

Hog Producers' Risk Management Attitudes And Desire For Additional Risk Management Education, George F. Patrick, Amy J. Peiter, Thomas O. Knight, Keith H. Coble, Alan Baquet

Department of Agricultural Economics: Faculty Publications

Hog producers in Indiana and Nebraska were surveyed about sources of risk, effectiveness of risk management strategies, and prior participation in and desire for additional risk management education. Ownership of hogs by the producer, size of the operation, and age did have significant effects on ratings of both sources of risk and effectiveness of risk management strategies. Probit analysis found age, prior attendance, knowledge and prior use of the tool, level of integration, and concern about price and performance risk have significant effects on interest in further education about production contracts, futures and options, packer marketing contracts, and financial management.

Understanding Patenting Decisions: A Classroom Experiment, Amalia Yiannaka

Cornhusker Economics

Innovations are crucial to the future success of firms, with most products having only a limited life cycle. When innovations occur, the firm must decide the best way to protect their intellectual property; this essentially comes down to keeping the innovation a trade secret or filing for a patent. Teaching students the basics of intellectual property protection is not difficult. Most are familiar with the general concept of patent protection and have some understanding as to why patents are an important tool available to firms and individual innovators. However, an in-depth analysis of the patenting decision making process can be …

Market Reports

Cornhusker Economics

No abstract provided.

Understanding Ethanol Plant Economics: Will Boom Turn Bust?, David J. Peters

Cornhusker Economics

Nebraska, along with several other Midwestern states, is in the middle of an ethanol boom. In the past few years a combination of high oil prices, cheap corn and favorable government policy have driven expansion of the industry. In turn, this has generated an unprecedented amount of industrial investment in many rural communities. However, local governments and economic developers have little information regarding the long-term economic viability of these plants. This information gap limits the ability of local governments to make informed public policy decisions about ethanol plants in their community, especially in terms of local tax incentives and abatements.

Corn Stalk Grazing: A Matter Of Economics, Matthew Stockton, Roger K. Wilson, Leslie Aaron Stalker

Cornhusker Economics

The United States Department of Agriculture’s January 1, 2007 “Cattle Inventory” report indicated that there were 1,940,000 beef cows that have calved in Nebraska. In another USDA report titled “Crops Planted, Harvested, Yield, Production, Price (MYA), Value of Production” it was estimated that there will be 9,000,000 acres of corn harvested in 2007. These numbers indicate the potential opportunity to graze cattle on corn stalk residue in Nebraska is huge. With corn harvest nearing completion and weaning time for many producers happening this month, farmers and ranchers are likely to be negotiating the terms of agreements to graze these corn …

Crop Planting Decisions For 2008 – An Initial Analysis, Paige Bek, H. Douglas Jose

Cornhusker Economics

Prices tend to be the driving factor when considering which crops to plant and how many acres to plant. Deciding what to plant in 2008 could be even more complicated than this year, the decision being compounded by the fact that wheat is at record high price levels. To analyze breakeven prices for the three major commodities we can use crop budgets of expected costs.

Intellectual Property Institutions For Plant Breeding, Richard K. Perrin, Lilyan Fulginiti

Lilyan E. Fulginiti Publications

Intellectual property rights for crop plant material should in principle increase social welfare by increasing private research investments to a level closer to the social optimum. In the US, plant patents were first introduced in 1930 by legislation that applied only to asexually reproduced plants. This was followed in 1970 by the weaker plant breeders' rights legislation (PBR) for sexually reproduced plants. Judicial decisions in 1980 and 1985, however, extended much stronger utility patent protection to plant materials. Here we examine theoretical welfare implications of weak PBR vs strong utility patents in a North-South context of technology transfer in agriculture …

Institutions And Agricultural Productivity In Mercosur, Preeti Bharati, Lilyan Fulginiti

Department of Agricultural Economics: Faculty Publications

We revisit earlier estimates of agricultural productivity in original Mercosur member countries and later associates: Argentina, Brazil, Paraguay, Uruguay, Chile, Bolivia, Colombia, Ecuador, Peru and Venezuela, for 1972-2002. We estimate a translog frontier production function and revise our earlier estimates as well as those of others that indicated declining agricultural productivity. We find that the average rate for the region was a strong 2.25 percent. All the member countries experienced positive agricultural productivity growth for the sample period with Brazil being the fastest gainer. Institutions such as investments in public health and in public agricultural R&D, as well as an …

Intellectual Property Institutions For Plant Breeding, Richard K. Perrin, Lilyan Fulginiti

Department of Agricultural Economics: Faculty Publications

Intellectual property rights for crop plant material should in principle increase social welfare by increasing private research investments to a level closer to the social optimum. In the US, plant patents were first introduced in 1930 by legislation that applied only to asexually reproduced plants. This was followed in 1970 by the weaker plant breeders' rights legislation (PBR) for sexually reproduced plants. Judicial decisions in 1980 and 1985, however, extended much stronger utility patent protection to plant materials. Here we examine theoretical welfare implications of weak PBR vs strong utility patents in a North-South context of technology transfer in agriculture …

Institutions And Agricultural Productivity In Mercosur, Preeti Bharati, Lilyan Fulginiti

Lilyan E. Fulginiti Publications

We revisit earlier estimates of agricultural productivity in original Mercosur member countries and later associates: Argentina, Brazil, Paraguay, Uruguay, Chile, Bolivia, Colombia, Ecuador, Peru and Venezuela, for 1972-2002. We estimate a translog frontier production function and revise our earlier estimates as well as those of others that indicated declining agricultural productivity. We find that the average rate for the region was a strong 2.25 percent. All the member countries experienced positive agricultural productivity growth for the sample period with Brazil being the fastest gainer. Institutions such as investments in public health and in public agricultural R&D, as well as an …

Economic Effects Of Gmos On Small Developing Countries, Alejandro Plastina, Konstantinos Giannakas

Cornhusker Economics

The advent of “Gene Revolution” has sparked a significant research effort aimed at identifying the market and welfare effects of the introduction of genetically modified (GM) crops into the food system. Due to the producer orientation of the first generation of GM products, particular emphasis has been placed on the agronomic benefits of the new technology and the potential for a productivity boost in developing countries.

How Much Ethanol, Ultimately?, Richard K. Perrin, Juan Pablo Sesmero

Cornhusker Economics

Ethanol prices are low in the Midwest, prompting suggestions that the boom is over. It is perhaps slowing down for the next couple of years, but is likely to resume after that. Today’s gross processing margin (ethanol price minus net corn feedstock cost) is in the range of $.80/gal – high by historical standards – but low relative to 2006 (see Figure 1 on next page). Also, the low ethanol price appears to be partly due to transportation and distribution bottlenecks, and those are not permanent.

Priority, Preferences And Irrigator-Power Disputes On The Niobrara River, J. David Aiken

Cornhusker Economics

Irrigators, the Nebraska Public Power District (NPPD) and the Nebraska Department of Natural Resources (DNR) are involved in conflicts between irrigators and NPPD over Niobrara River water use. This newsletter will discuss the role of priority and preferences in Nebraska surface water law, DNR priority administration, loss of appropriations and how similar power-irrigation priority disputes have been resolved in the Loup River Basin.

Barriers To Farm/Ranch Business Succession, David J. Goeller

Cornhusker Economics

Data from the United States Department of Agriculture (USDA) suggests a trend of fewer people entering farming and ranching as their chosen occupation. This trend has been occurring for many years, as the average age of farm operators continues to increase. Many have asked “Why is this happening?” and “What are the factors that create barriers to a career in agricultural production?”

Gains And Losses To Cattle Feeders From The Bse-Related Bans On Canadian Cattle Imports And Beef Exports, Dimitrios Panagiotou, Azzeddine Azzam

Cornhusker Economics

The discovery in December 2003 of a Bovine Spongiform Encephalopathy (BSE) case in the state of Washington led to an import-ban on U.S. beef by more than forty countries, including Japan, South Korea, Mexico and Canada. These four countries are the most lucrative destinations for U.S. beef exports, accounting for more than 90 percent of the total value. In 2004, U.S. beef exports were at 17 percent of their level in 2003, with Japan and South Korea imposing a virtually total ban, while, except for a brief time, Canada and Mexico leaving their borders partially open. Three years and several …

Republican River Challenges, J. David Aiken

Cornhusker Economics

The amount of water that can be used for irrigation in the Republican River Basin is controlled by the Republican River Compact. On June 22, 2007 the Nebraska Department of Natural Resources (DNR) presented to officials of the Republican River Basin Natural Resource District (NRD), DNR projections of future Republican River Basin water allocations to Nebraska. The DNR model (which is the official model established in the Republican River Basin Compact litigation settlement) indicates that streamflows will decrease over the next 40 years, due primarily to the impact of past and current ground water pumping. The DNR also calculated ground …

Cropland Leasing Decisions For 2008, Bruce Johnson, Ben Blomendahl

Cornhusker Economics

With more than 40 percent of Nebraska’s agricultural land being leased, thousands of landowners and tenants face important lease decisions each year. Currently, the economic magnitude of these decisions is even greater, given the circumstances for 2008 crop prospects.

Benefits Of The New Tax Law Changes For Farmers, Tina N. Barrett

Cornhusker Economics

The Jobs and Growth Tax Relief Reconciliation Act of 2003 was signed into law on May 28, 2003 and contains many reductions in taxes that farmers can take advantage of this year.

The Impact Of Weather Extremes On Agricultural Production Methods: Do Extreme Weather Events Increase Adoption Of Conservation Tillage Practices?, Karina Schoengold

Cornhusker Economics

A better understanding of how farmers adjust their production practices to cope with extremely wet or dry conditions is essential for developing effective drought mitigation policies and reducing the impact of other natural disasters. Reducing the risk associated with drought and flood in the long-run may be more cost effective than smoothing short-term income losses through disaster relief money. Most existing assistance programs focus on diversifying and stabilizing income risks through crop insurance and direct payments, however there are fewer efforts designed to reduce the long-term agricultural risk. Climate change makes this particularly important, as expected impacts include more droughts …

Offsetting The Oil Addiction: Farmers Motivated To Sequester Carbon, Robert Sheeder, Gary D. Lynne

Cornhusker Economics

President Bush has noted that the U.S. is “addicted” to oil and other fossil fuels. This observation is well-founded: In 2006, the traditional fossil fuels of coal, natural gas and petroleum accounted for nearly 86 percent of all energy usage in the country, with petroleum alone accounting for nearly half of the fossil fuel use (see: http://www.eia.doe.gov). Unfortunately, it doesn’t appear that this country’s thirst for fossil fuels will be quenched anytime soon, as projected total energy consumption in the U.S. is expected to increase 1.3 percent annually through the year 2030. This expected rise in consumption will lead to …

Shifting From A Price Safety Net To A Revenue Safety Net, Bradley Lubben, Troy J. Dumler, G. Art Barnaby

Department of Agricultural Economics: Presentations, Working Papers, and Gray Literature

In late July, the U.S. House of Representatives passed the Farm, Nutrition, and Bioenergy Act of 2007, or the “2007 Farm Bill,” to reauthorize farm, food, and other agricultural programs for 2008 through 2012. This culminated more than two months of discussion in the House Agriculture Committee and subcommittees and reflected much of the policy direction championed by committee chair Collin Peterson of Minnesota.

In the Senate, the agricultural committee under Chairman Tom Harkin of Iowa has yet to begin formal consideration of the 2007 Farm Bill. However, given some comments from Senator Harkin, there are some elements of …

Livestock Insurance Website Launched, Josie Waterbury, Darrell R. Mark

Cornhusker Economics

In the last several years, cattle feeders and swine finishers have experienced increased volatility in both their output selling price and their major commodity input costs. For cattle feeders, these main risks include changes in fed cattle, feeder cattle and corn prices. Figure 1 on the next page shows that the spreads between these three key markets have had significant changes during the last several years. The same also holds true for swine as lean hog, corn and soybean meal markets have been more variable in recent years, and the spread between these prices continuously changes. Because these spreads influence …

Shifting From A Price Safety Net To A Revenue Safety Net, Bradley Lubben

Cornhusker Economics

In late July, the U.S. House of Representatives passed the Farm, Nutrition, and Bioenergy Act of 2007, or the “2007 Farm Bill,” to re-authorize farm, food and other agricultural programs for 2008 through 2012. This culminated more than two months of discussion in the House Agriculture Committee and subcommittees and reflected much of the policy direction championed by committee chair Collin Peterson of Minnesota.