Economics

USDA Farm Service Agency (FSA) has Assistance Programs for Ohio Farm Operations Impacted by Drought

David Marrison, OSU Extension Field Specialist – Farm Management
Dr. Aaron Wilson, OSU Extension Ag Weather and Climate Field Specialist

Drought conditions started in Ohio back in mid-June and have intensified all summer. According to the U.S. Drought Monitor report on August 27, 2024, D4-exceptional drought was introduced to Ohio (Meigs and Athens Counties) for the first time since the U.S. Drought Monitor’s inception in 2000. On September 5, D4 increased to 7.35% of the state, while other categories of drought (D1-D3) significantly expanded. It is important to remember that D4 conditions only occur once every 50 to 100 years.

A map of the state of ohio Description automatically generatedDespite much needed rainfall occurring last week from Meigs and Athens Counties to Belmont County, it was not enough to overcome the drought conditions made worse by scorching heat with many days with high temperatures in the mid to upper 90s. Farther north, very little rain fell in August or during the summer. At the Zanesville Municipal Airport for example, only 0.17” of rain fell in August and 4.95” fell in June-August. This marks the driest August on record and second driest summer for this location for the period 1946-2024. Similar conditions are present for many counties across south central and east central Ohio.

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Ohio Farm Custom Rates: 2024

Barry Ward, Director, OSU Extension Income Tax School Program; Leader, Production Business Management
Eric Richer, Associate Professor and Field Specialist, Farm Management
John Barker, OSU Extension Educator ANR, Knox County
Amanda Bennett, OSU Extension Educator ANR, Miami County

Farming is a complex business and many Ohio farmers utilize outside assistance for specific farm-related work. This option is appealing for tasks requiring specialized equipment or technical expertise. Often, having someone else with specialized tools perform tasks is more cost effective and saves time. Farm work completed by others is often referred to as “custom farm work” or more simply, “custom work.” A “custom rate” is the amount agreed upon by both parties to be paid by the custom work customer to the custom work provider.

Custom rates increased for the majority of field operations in 2024 as compared to surveyed rates in 2022 but the increases did vary by operation. Examples include an increase of 6% for Planting Corn (30 Inch Rows with Fertilizer Application), 5.6% for Harvesting Corn (Combine, Grain Cart, Haul Local to Farm), 21% for Spraying (Self-Propelled Sprayer, Crop Protection Chemicals) and 24% for Field Cultivator.

New field operations in this year’s survey and summary include Continue reading Ohio Farm Custom Rates: 2024 →

New Study Shows Effectiveness of American Lamb Checkoff Program

American Lamb Board

According to a recent study, lamb consumption increased by $1.17 billion to $1.31 billion.

The American Lamb Checkoff Program has substantially increased the annual value of American Lamb despite the modest funding available for promotion, according to the Texas A&M University 2024 report “Return on Investment in the American Lamb Checkoff Program” conducted by agricultural economists Dr. Gary Williams and Dr. Oral Capps, Jr.

According to the study, lamb consumption increased by $1.17 billion to $1.31 billion. Researchers attributed the increase to ALB’s promotional efforts, which increased both lamb consumption rates and retail lamb prices. This “lift” resulted in an average annual growth of between $58.7 million and $62.4 million.

“The purpose of the Lamb Checkoff has been to Continue reading New Study Shows Effectiveness of American Lamb Checkoff Program →

Limited Goat, Lamb Production May Improve ’24 Prices

David P. Anderson, Livestock Marketing Specialist, Texas AgriLife and Texas A&M university
JJ Jones, Area Agricultural Economics Specialist, Oklahoma State University Department of Agricultural Economics
(Previously published online with: Farm Progress, Southwest FarmPress: January 25, 2024)

2023 lamb and goat prices lagged behind the record-high prices of 2022. Based on limited production in 2024, prices have the opportunity to rise.

The past year was difficult for lamb and goat prices. Early 2022 saw record-high prices, but they collapsed in the year’s second half. It took until the second half of 2023 for prices to increase above the year before, but they still lag well below the earlier record highs. Prices have the opportunity to grow in 2024 based on limited production.

Lamb outlook
Several factors worked in the lamb’s favor to allow prices to slowly climb much of the year. Lamb imports were the lowest since 2019. The amount of lamb in Continue reading Limited Goat, Lamb Production May Improve ’24 Prices →

Manage Feed Costs by Evaluating Hay Waste

PennState Extension
(Previously published online with PennState Extension: May 26, 2023)
Sheep and goat operations all experience some amount of hay waste during winter feeding. Now is a good time to look back and evaluate how much hay was wasted.

The largest input cost for any livestock enterprise is feed costs. In forage dependent operations, most of these feed costs occur during the winter when feeding hay. Spring is a great time to assess hay feeding areas and consider how much hay the sheep or goats wasted over the winter.

Is there a large amount of wasted hay lying next to the hay feeders? Did pens inside the barn require minimal bedding last year due to the amount of hay waste? A “yes” answer to either of these questions should inspire producers to look more closely at feed quality and feeder design. Using feeders should be an obvious means to help reduce waste. Less obvious perhaps is the concept that feeders can also help to promote animal health. This occurs by preventing fecal or soil contamination that can lead to problems such as internal parasites, coccidia, or listeriosis. Hay losses can range from Continue reading Manage Feed Costs by Evaluating Hay Waste →

Where to Buy Sheep?

Eastern Alliance for Production Katahdins (EAPK) Communications Committee
(Previously published online with EAPK: June 23, 2023)

We often get asked “Where’s the best place to buy sheep?” A lot depends on your goals and what you’ll use the sheep for, but one thing is pretty much certain: Don’t buy sheep from the local sale barn. Below are some of the more common sale venues with some of the pros and cons listed.

Venue Pros Cons
On Farm
  • Often lowest cost option
  • Least chance of biosecurity issues
  • Least stress for animals
  • Ability to inspect the whole flock and observe management
  • Potentially more choices of one farm’s genetics
  • May allow better opportunity to develop relationship with seller, especially important if looking for a mentor
  • More flexibility on sale dates
  • Limited to only that farm’s genetics
  • Location (potentially)
  • If out-of-state, veterinary transport certificate may require additional time/expense
  • Seller may require cash-only payment
In-Person Breed Auctions
  • Wider range of options and genetics available in one location
  • Ability to physically examine and compare animals
  • Consigners usually bring their best to sell
  • Seller usually available on site to answer questions
  • Animals sell quickly by sale order
  • On-site veterinarian for transport certificates
  • Most forms of payment typically accepted
  • Mingling with other animals at sale increases biosecurity risks
  • Additional stress for animal (transport to sale; sale itself)
  • Competitive pricing
  • Consecutive bidding means you can’t go back and bid on an earlier animal if you get outbid later in the sale
Online Auctions
  • Potentially wider range of options and genetics
  • Consigners usually offer their best to sell
  • Simultaneous bidding allows you to bid on other animals if outbid on first choice
  • Length of sale allows time to plan bidding
  • Competitive pricing
  • Electronic payment usually preferred
  • Unable to handle or visually inspect animal
  • Seller may be difficult to reach for questions
Combination Auction – online auction with animals available in one location for inspection
  • Wider range of options and genetics
  • Ability to physically examine and compare animals
  • Consigners usually offer their best to sell
  • Simultaneous bidding allows you to bid on other animals if outbid on first choice
  • Length of sale allows time to plan bidding
  • Sellers usually available onsite to answer questions
  • On-site veterinarian available to provide transport certificates for animals located on-site
  • Mingling with other animals at sale increases biosecurity risks
  • Additional stress for animal (transport to sale; sale itself)
  • Competitive pricing
  • If buyer not in attendance or animal not on-site, must arrange transport
  • Acceptable forms of payment vary by sale

Regardless of where you choose to purchase sheep, keep in mind the basics. First identify your goals for your flock and farm, and develop a plan to reach those goals. Set a budget (and stick to it). Identify what specific traits you want to improve and/or downplay. Do your research – talk to the breeders, understand how their sheep are managed and their goals for their flock. Study individual animals offered for sale and remember there is no perfect animal.

Are You Charging Enough for Your Hay?

Andrew Holden, OSU Extension Educator ANR, Ashtabula County

With hay inventories at all-time lows, are you charging a competitive rate? What is a fair price to charge for hay? Are you still making a profit on your hay sales with rising input cost? Those making hay should consider the recent market changes, long-term trends, and personal enterprise cost to make sure their hay is priced fairly and competitively.

Let’s take a look at some of the hay numbers, both nationally and at the state level, as well as some tools to help hay producers fully reconcile their input cost.

National Hay Inventory
Last December the USDA reported that hay inventories in the United States were at approximately 71.9 million tons. This was a decrease of 7 million tons from the year before, roughly a 9% difference. This follows the trend over the last 20 years of decreasing hay stocks and has put us at the lowest hay inventory in over 70 years. The low inventory is likely to Continue reading Are You Charging Enough for Your Hay? →

How Much Should You Charge? Pricing Your Meat Cuts

Brian F. Moyer, Education Program Associate, Business and Community Vitality, Penn State University Extension
(Previously published online: PennState Extension – December 22, 2022)

Pricing meat for direct-to-consumer sales.

It doesn’t matter if you are selling halves, quarters, or single cuts, you need to know your cost of production first. What are your costs of raising that animal from day one until the day of slaughter? In any business endeavor, keeping good records is essential to knowing if you are going to be profitable or not. Once you know your cost of production, there are some tools you can use to help you determine what price you may want to attach to your fine, farm-fresh product.

Mike Debach of the Leona Meat Plant in Troy, Pennsylvania, has a nifty process you can use thatwill help you figure out your costs after processing so you can determine your retail price. For this example, understand that the cost of production will vary depending on Continue reading How Much Should You Charge? Pricing Your Meat Cuts →