Emerging Issues in Agriculture

Agricultural Economics

Macroeconomic Conditions

Weak overall economy affecting demand for most all ag

commodities – especially hitting dairy and livestock producers.  Equine sales are also down drastically.  Domestic and international demand.

Unemployment Impacts on demand, off-farm job

prospects

Macroeconomic Conditions Continued focus on business planning,

marketing education, new business development

Moneywise -    The MONEYWI$E financial management website is a cross disciplinary approach to assist extension clientele in decision-making in today’s economy.

Annie’s Project – Annie’s Project is a risk management education program designed specifically for farmwomen.

Economics of Production Agriculture

Issue RankLabor management and availability 1.9Variable input prices 4.2International trade competition 8.1Food safety standards and compliance 3.6Direct marketing issues 4.8Retailer consolidation and access 5.6Land prices and development pressures on ag 7.3Distribution cost/availability 6.0Concern for lower prices 5.2Recession impact on premium/specialty products 5.7Uncertainty of government policies regulating production 6.1

Economics of Production Agriculture

Rising input costs – still an issue, although is has improved.  Especially Potash.  Greatly affecting production costs on hay, which is hurting cow-calf operators as well.

 Price volatility – We just aren’t used to dealing with this much volatility.  We need to work with farmers on marketing plans incorporating price risk management - futures markets and livestock and crop price risk insurance.

New Crops and Diversification – Horticulture, switchgrass, organic grains require new cost and market assessments.

Economics of Production Agriculture – Rising Input Costs

Optimal fertilization rates for corn (possibly wheat): Significant fluctuations in both commodity and N prices have occurred in the last three years making this issue more relevant than in the past. 

Labor – Changing H2A program will boost labor costs even more, especially impacting labor intensive enterprises like tobacco, horticulture.

Economics of Production Agriculture – Price Volatility

Cow-calf profitability – Cow-calf operators are in about their 3rd tough year. Long run planning needed, such as cattle numbers and strategies to survive a brutal phase of the cattle cycle.

Grain price volatility – Continuing impact of ethanol, uncertainty of support programs, political environment, emerging renewable fuels.

Tobacco contract reductions – Structural changes in industry

Economics of Production Agriculture – New Crops and Diversification

 Emerging market channels – Auctions, direct markets, thin markets where prices for specialty products are hard to discover. Grapes, nursery, organic, and other high-value attributes especially volatile.

Economics of Production Agriculture – New Crops and Diversification

 Sustainability – Economics of alternative production systems for livestock, dairy, grain, horticultural crops.

Animal Welfare Environmental Stewardship

Mandates

Legislative and market mandates for sustainability

Implementation challenges for producers