Farm Office Live to Analyze USDA’s Pandemic Assistance for Producers Initiative

By Barry Ward, David Marrison, Peggy Hall, Dianne Shoemaker and Julie Strawser – Ohio State University Extension

April’s “Farm Office Live” will focus on details of the USDA’s Pandemic Assistance for Producers” initiative announced on March 24, 2021. Changes were made in effort to reach a greater share of farming operations and improve USDA pandemic assistance.

During the webinar, we will be sharing details about the pandemic initiative and discussing some of the changes made to the Coronavirus Food Assistance Program (CFAP).  Our Farm Office Team will also provide a legislative update and discuss changes to the Paycheck Protection Program and Employee Retention Credits. They will also be on hand to answer your questions and address any related issues.

Two live sessions will be offered on Wednesday, April 7, from 7:00 – 8:30 p.m. and again on Friday, April 9, from 10:00 – 11:30 a.m. A replay will be available on the Farm Office website if you cannot attend the live event.

Farm Office Live is a webinar series addressing the latest outlook and updates on ag law, farm management, ag economics, farm business analysis and other related issues. It is presented by the faculty and educators with the College of Food, Agricultural and Environmental Sciences at The Ohio State University.

To register or view past recordings, visit https://go.osu.edu/farmofficelive.

For more information or to submit a topic for discussion, email Julie Strawser at strawser.35@osu.edu or call the Farm Office at 614-292-2433.

Farm Office Live Continues!

by: Barry Ward, David Marrison, Peggy Hall, Dianne Shoemaker – Ohio State University Extension

“Farm Office Live” continues this winter as an opportunity for you to get the latest outlook and updates on ag law, farm management, ag economics, farm business analysis and other related issues from faculty and educators with the College of Food, Agricultural and Environmental Sciences at The Ohio State University.

Each Farm Office Live begins with presentations on select ag law and farm management topics from our specialists followed by open discussions and a Q&A session. Viewers can attend “Farm Office Live” online each month on Wednesday evening or Friday morning, or can catch a recording of each program.

The full slate of offerings remaining for this winter are:

  • March 10th 7:00 – 8:30 pm
  • March 12th 10:00 – 11:30 am
  • April 7th 7:00 – 8:30 pm
  • April 9th 10:00 – 11:30 am

Topics to be addressed in March include:

  • Coronavirus Food Assistance Program (CFAP)
  • Proposed Stimulus Legislation
  • General Legislative Update
  • Ohio Farm Business Analysis – A Look at Crops
  • Crop Budget & Rental Rates

To register or view past recordings, visit https://go.osu.edu/farmofficelive

For more information or to submit a topic for discussion, email Julie Strawser at strawser.35@osu.edu or call the farm office at 614-292-2433. We look forward to you joining us!

USDA Agricultural Projections to 2030

by: Chris Zoller, Extension Educator, ANR, Tuscarawas County

Click here for PDF version–easier to view Figures

The United States Department of Agriculture (USDA) recently released the interagency report: USDA Agricultural Projections to 2030.  These long-term projections include several assumptions related to the Farm Bill, macroeconomic conditions, farm policy, and trade agreements.  While long-term projections are based on assumptions and many unknowns, they do provide a glimpse of how U.S. farm commodity prices may perform over the next several years.  Anyone interested in reading specific details is encouraged to see the report available here: https://www.ers.usda.gov/webdocs/outlooks/100526/oce-2021-1.pdf?v=3513.2.

This article briefly summarizes selected selections of the 102-page report, including U.S. crop prices, milk production, U.S. farm income, and government payments.  Figures from the report are included to accompany the text.

U.S. Crop Prices

Rising global demand for diversified diets and protein will continue to stimulate import demand for grains. Increased demand for these crops is accompanied by rising competition for market share from countries such as Brazil, Argentina, the EU, and the Black Sea region. The United States also faces challenges related to ongoing tensions with trade partners and a relatively strong U.S. dollar. Although strong trade competition continues, U.S. commodities remain generally competitive in global agricultural markets, with U.S. corn and soybean exports projected at record highs by 2030/31. Nominal prices for wheat, cotton, and rice are expected to rise modestly between 2021/22 and 2030/31.

 

Milk Production

Milk production is projected to rise at a compound annual growth rate of 1.1 percent over the next 10 years, reaching 248 billion pounds in 2030. With slow growth in domestic demand as the economy recovers from the pandemic, the dairy herd will remain relatively flat in the middle of the decade but grow in the latter years. In 2030, milk cows are projected to number 9.43 million head. Economies of scale trends are expected to continue, leading to further farm consolidation. Technological and genetic developments will contribute to increasing yields. In 2030, milk production per cow is projected to average 26,295 pounds.

  • Commercial use of dairy products is expected to rise faster than the growth in the U.S. population over the next decade.
  • Global demand for U.S. dairy products is expected to continue to grow over the next 10 years, with the largest increases being in exports of products with high skim-solids content such as dry skim milk products (nonfat dry milk and skim milk powder), whey products, and lactose.
  • The all-milk price in 2021 is expected to be lower than 2020 as milk production increases significantly. Feed prices are expected to increase from 2020 to 2021. Milk production in 2022 is projected to grow at a rate slower than in 2020 and 2021 because of lagged supply response to relatively low milk prices and relatively high feed prices in 2021. With slow milk production growth in 2022 and an increase in demand as the economy is recovering from the pandemic, the all-milk price is projected to increase in 2022. As the industry adjusts, the all milk price dips to lower levels in 2023-25. The all milk price then increases in nominal terms later in the decade.

 

U.S. Farm Income

Net farm income and net cash income are projected to decrease in 2021. Net farm income is projected to decrease $19.5 billion in 2020 to $100.1 billion in 2021. Net cash farm income is projected to decrease 16.7 percent in 2020 to $111.7 billion for 2021. The projected decline in net farm income for 2021 is primarily because of lower government payments relative to 2020. Farmers received an estimated $24.3 billion in direct payments from the Coronavirus Food Assistance Programs 1 and 2 during 2020. The 2021 farm income value does not include payments made under the Consolidated Appropriations Act 2021 that was passed after the projections were tabulated.

Government Payments

After falling $35 billion in 2021 to $11.5 billion, direct government payments are projected to decline again in 2022 as market prices are expected to improve and ad hoc payment programs expire. Government payments are then expected to climb before decreasing after 2024 through 2030. The Conservation Reserve Program (CRP), ARC and PLC payments collectively account for the largest share of direct government payments to the agricultural sector over 2021-30. These projections also assume no government payments from potential new farm sector programs.

 

Moving Forward

Again, many things can/will happen between now and 2030 to alter these projections.  However, they are one source of information to use for long-term planning.  Based on these projected production levels and prices, will you be competitive in the long-term?  If not, what changes are necessary to make you successful?  If so, what can you do to be even more successful?  I encourage you to talk to your Extension Educator and other advisors as you complete farm business planning.

Lady Landowners Leaving a Legacy Series 

by: Amanda Douridas and Amanda Bennett, OSU Extension

Land is an expensive and important investment that is often handed down through generations. As such, it should be cared for and maintained to remain profitable for future generations.

Almost half of landowners in Ohio are women. OSU Extension in Champaign and Miami Counties are offering a series designed to help female landowners understand critical conservation and farm management issues related to owning land. It will provide participants with the knowledge, skills and confidence to talk with tenants about farming and conservation practices used on their land. The farm management portion will provide an understanding of passing land on to the next generation and help establish fair rental rates by looking at current farm budgets.

The series runs every Friday, February 26 through March 26 from 9:00-11:30 a.m. and will be a blend of in-person and virtual sessions. It is $50 for the series. If you are only able to attend a couple of session, it is $10 per session but there is a lot of value in getting to know other participants in the series and talking with them each week. Registration can be found at go.osu.edu/legacy2021. For more information, please contact Amanda Douridas at Douridas.9@osu.edu or 937-772-6012. Registration deadline is February 24. The detailed agenda can be found at

https://miami.osu.edu/events/lady-landowners-leaving-legacy.

 

Farm Office Live Returns on February 10 & 12

by: Peggy Kirk Hall, Associate Professor, Agricultural & Resource Law

Wondering what’s happening with CFAP, the Paycheck Protection Program, and Executive Orders?  So is the Farm Office team, and we’re ready to provide you with updates.  Join us this month for Farm Office Live on Wednesday, February 10 from 7–8:30 p.m. and again on Friday, February 12 from 10–11:30 a.m., when we’ll cover economic and legal issues affecting Ohio agriculture, including:

Status of the Coronavirus Food Assistance Program (CFAP)

Update on the Paycheck Protection Program (PPP).

Tax credits information

Executive Orders that may impact agriculture

Legal update on small refinery exemptions

Farm Business Analysis program results

Legislative update

Your questions

To register for the free event, visit this link:  go.osu.edu/farmofficelive

 

 

2021 Cow-Calf Outlook Review

by: Garth Ruff, Beef Cattle Field Specialist

For beef producers in Ohio and across the U.S., 2020 was no walk in the park for several reasons related to the COVID-19 pandemic. On January, 26 2021 the OSU Beef Team hosted a Cow-Calf Outlook program featuring Dr. Kenny Burdine, Extension Livestock Marketing Specialist from the University of Kentucky.

In this presentation Dr. Burdine highlights reviews the impacts of COVID on the beef cattle industry, some management considerations for beef producers looking to add value to feeder cattle, touches on rising feed prices, and looks at the feeder cattle markets in the coming year.

For the full presentation https://www.youtube.com/watch?v=pUtWYuo1zR0

We’ve also pulled some short clips showing the value of increased management. One management consideration is to shorten and control the breeding season to increase marketing power via increasing uniformity and group size. https://www.youtube.com/watch?v=IFkOGHEJrgA&t=87s

Another management toll that will increase the value of calves is to castrate bull calves and market steers, as selling steer calves will be rewarded in the marketplace. https://www.youtube.com/watch?v=aSOTdDSiZpY

Most Farm Families Rely on Off-Farm Income

by: Chris Zoller, Extension Educator, ANR in Tuscarawas County

The United States Department of Agriculture Economic Research Service (USDA-ERS) completed a survey in 2019 to determine the number of hours principal farm operators work per week on-farm and off-farm.  USDA-ERS defines the principal operator as the person who makes day-to-day decisions.  The paragraph below is taken directly from the report.

Off-farm income supplements farm income for most farm households, in addition to offering benefits such as health insurance. In 2019, about 71 percent of farm households had one or more household members earning an off-farm salary or wage. More than 40 percent of principal operators worked off-farm, contributing about 54 percent of the total off-farm labor hours reported for their households. Principal operators who reported off-farm employment worked on average 15 hours off the farm per week in 2019. Compared with the seasonality of on-farm work, off-farm work offered principal operators more consistency—with operators working about 25 percent of total off-farm hours in each quarter of the year. However, principal operators who worked more on-farm tended to work less off-farm across a variety of commodities. On average, principal operators with livestock, beef cattle, and fruit and tree nut farm operations worked fewer on-farm hours and more off-farm hours in 2019. Principal operators on those farms may be more vulnerable to disruptions in the off-farm economy, such as increased unemployment because of the COVID-19 pandemic.

Figure 1.  Average Weekly On-Farm and Off-Farm Hours Worked

FARM OFFICE LIVE WINTER EDITION

by: Barry Ward, David Marrison, Peggy Hall, Dianne Shoemaker – Ohio State University Extension

“Farm Office Live” returns virtually this winter as an opportunity for you to get the latest outlook and updates on ag law, farm management, ag economics, farm business analysis and other related issues from faculty and educators with the College of Food, Agriculture and Environmental Sciences at The Ohio State University.

Each Farm Office Live will start off with presentations on select ag law and farm management topics from our experts and then we’ll open it up for questions from attendees on other topics of interest.  Viewers can attend “Farm Office Live” online each month on Wednesday evening or Friday morning, or can catch a recording of each program. The full slate of offerings for this winter:

January 13th 7:00 – 8:30 pm

January 15th 10:00 – 11:30 am

February 10th 7:00 – 8:30 pm

February 12th 10:00 – 11:30 am

March 10th 7:00 – 8:30 pm

March 12th 10:00 – 11:30 am

April 7th 7:00 – 8:30 pm

April 9th 10:00 – 11:30 am

Topics to be addressed this winter include:

  • New COVID Related Legislation – Consolidated Appropriations Act, 2021
  • Outlook on Crop Input Costs and Profit Margins
  • Outlook on Cropland Values and Cash Rents
  • Outlook on Interest Rates
  • Tax Issues That May Impact Farm Businesses
  • Legal trends for 2021
  • Legislative updates
  • Farm business management and analysis updates
  • Farm succession & estate planning updates

Who’s on the Farm Office Team?  Our team features OSU experts ready to help you manage your farm office:

  • Peggy Kirk Hall — agricultural law
  • Dianne Shoemaker — farm business analysis and dairy production
  • David Marrison — farm management
  • Barry Ward — agricultural economics and tax

Register at  https://go.osu.edu/farmofficelive

We look forward to you joining us this winter!

Farm Management Needs Pulse Survey

The Ohio State University Extension Agriculture and Natural Resources program works to improve production and maximize profitability while promoting environmental stewardship.

We are reviewing our farm management resources and ask you to rank your “top 3” areas from the following list for your farm management needs and support wanted.

  1. Agricultural Finance: farm income, farm business analysis, financial management, budgeting, and investing, agricultural taxes, benchmarking, record keeping
  2. Agricultural Human Resources: farm succession planning, labor law and policy, human resource management/labor management, liability
  3. Agricultural Law: legal issues within the agriculture system and estate planning
  4. Agricultural Marketing: marketing and price analysis, commodity trading
  5. Agricultural Policy: Farm Bill/Agricultural Policy, environmental and resource policy agricultural trade
  6. Agricultural Production and Risk Management: risk evaluation and management, land use, crop and livestock production, crop and livestock insurance
  7. Agricultural Supply Chain Stability and New Market Access: stability of upstream and downstream supply chains during disruptions, identifying new markets
  8. Rural and Community Development: infrastructure – broadband access, community resources, health care, non-agricultural small business support; rural/urban interface

Please complete the survey at: https://go.osu.edu/FarmMgmtNeeds by December 18, 2020.

Thank you.

Dairy Risk Management Series Offers a Range of Important Information to Producers

By Ben Brown, Dianne Shoemaker and Chris Zoller

Offered in three sessions during November, OSU Extension, in partnership with the Ohio Dairy Producers Association, delivered a dairy risk management webinar series covering three important topics: milk pricing and producer price differentials, outlooks for domestic and international milk product markets, and dairy risk management tools. Slides and recordings for all presentations can be found at https://farmoffice.osu.edu/events/archived-videos.

Session one was presented by Mark Stephenson from the University of Wisconsin discussing milk pricing and producer price differentials. Due to COVID-19 disrupting supply chains and a change in the 2018 Farm Bill using the average of Class III and Class IV milk prices instead of the higher of the two to set Class I milk prices, Ohio dairy producers experienced several months of historically large negative producer price differentials. According to Dr. Stevenson, these negative PPDs could continue for a couple more months and producers need to be aware of these when making business planning decisions. Dr. Stephenson’s presentation can be found at https://studio.youtube.com/video/fpGfd5c0pi4/edit.

Session two highlighted domestic and international markets. William Loux from the U.S. Dairy Export Council started off the session with a presentation on dairy supply and demand outside the United States. International demand for US dairy products is up in 2020 driven primarily by China and the Middle East/ North Africa Region. Southeast Asia also saw large year over year increases in dairy product imports. Loux pointed out there are a couple things to watch for in the next couple of months: COVID-19 resurgence, Brexit and the ability to trade with England, and the subsidization of dairy exports by India. He concluded by saying it is a good sign that the US continues to export dairy products in strong numbers even with US dairy prices above world dairy prices. His session can be found at https://www.youtube.com/watch?v=fJsHMSkcHVc

Also in session two, Mike McCully from the McCully Group provided price expectations for US dairy markets over the next 12 months. Key points from his presentation included product specific outlooks with cheese prices being strong on solid demand, butter prices being extremely weak on burdensome supplies and milk prices being relatively stable. He continued that the outlook is mixed, with dairy markets having a bearish tone heading into the first quarter of 2021 on growing milk supplies and concerns over demand, but the second half of 2021 being more bullish given an expected reduction in milk supply growth and possible demand improvements. Mike’s full presentation can be found at https://www.youtube.com/watch?v=NAy6Xy-Nb7s&t=119s

Session three focused on risk management tools for dairy producers. OSU Extension Educator Chris Zoller provided an overview of USDA’s Dairy Margin Coverage program, which is authorized through the Farm Bill every year. Producers wishing to sign up for DMC need to contact their FSA office prior to December 11 to enroll for 2021. Chris’ presentation can be found here: https://www.youtube.com/watch?v=ZR_4SukNX2I&t=24s

Dr. Kenny Burdine, Associate Extension Professor, University of Kentucky, also presented during session three.  Dr. Burdine discussed Livestock Gross Margin Insurance- Dairy and gave a brief overview of using futures and options in milk price protection. Dr. Burdine suggested USDA’s Dairy Margin Coverage Program as the first level of protection for smaller producers, with Livestock Gross Margin Insurance- Dairy being the second level of protection. Kenny’s presentation can be found here: https://www.youtube.com/watch?v=PdjEijnDCMw

Session three concluded with a presentation by OSU Extension Educator Jason Hartschuh on Dairy Revenue Protection Insurance offered through the Risk Management Agency. Jason reviewed six decisions for dairy producers to consider and provided examples of how to use the program. Additional information about this topic can be found at dairy@osu.edu under Dairy Revenue Protection. Jason’s presentation from the webinar series can be found at https://www.youtube.com/watch?v=B38TVJkrlQU

For any additional questions or thoughts for future risk management webinars please reach out to Ben Brown at brown.6888@osu.edu, Dianne Shoemaker at shoemaker.3@osu.edu, Chris Zoller at zoller.1@osu.edu or your local OSU Extension Office.