Is Trouble Brewing for the Farm Economy
For the first time since September 2020, the rural economy is showing signs of weakness. That’s according to the March Rural Mainstreet Index (RMI) from Creighton University.
For June 2022, the RMI sits at 49.8. That is down from May’s 57.7. The index ranges between 0 and 100 with a reading of 50 representing growth neutral and is generated by a monthly survey of bank CEOs in rural areas of a 10-state region dependent on agriculture and/or energy.
“Much like the nation, the growth in the Rural Mainstreet economy is slowing,” says Ernie Goss, who chairs Creighton’s Heider College of Business and leads the RMI. “Supply chain disruptions from transportation bottlenecks and labor shortages continue to constrain growth. Farmers and bankers are bracing for escalating interest rates — both long-term and short-term.”
Bankers were asked their U.S. recession expectations for the next 12 months. Approximately 92.9% rate the likelihood of a U.S. recession above 50%. Only 7% rated a recession probability below 50%. Read the Full Story
Farmland Values Keep Rocketing Upward in South Dakota
South Dakota farmland values jumped nearly 27% in the past year and values show no sign of slowing down. Values in northeastern and east-central South Dakota grew the fastest, jumping just under 30%
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The values were released in May in South Dakota State University’s annual farm real estate survey. The reporting period covers Jan. 31, 2021, to Feb. 1, 2022.
The increases reversed a nearly seven-year trend of declining values. The previous high came in 2013 when corn prices also climbed above $7 a bushel.
As Solar Grows, What Happens to Ag?
Chad Dacus takes great pride in being a multi-generational farmer. He farms with his father, Chuck, near Somerville, Tenn., on land that has been passed down through his mother’s side of the family for more than a century. He says keeping that land in the family and preserving it for the next generation is his ultimate goal.
So, nearly 10 years ago, when Dacus was first approached by an energy company about leasing property rights for a solar farm, he saw an opportunity to preserve family property.
“At the beginning it was more about keeping the land in the family,” Dacus recalled. “This was an opportunity to produce an income and keep the land. And in 30 years, my kids can get something from this.” Read the Full Story
Senior Water Rights Holders in Nevada Will Feel the Pinch
In a majority opinion, the Nevada Supreme Court this week approved a groundwater management plan for Diamond Valley that reduces not only the water junior water rights holders can pump but what senior water rights owners can pump.
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The plan developed by the state engineer is designed to reduce the water use over the next 35 years to the level Diamond Valley can actually support.
But opponents, including three members of the high court, say the ruling effectively punches a hole in 155 years of Nevada water law that has always allowed senior water rights owners to keep pumping their full allotment of water even if that means other users go dry during times of drought.
Facing Challenges, Western Farmers Warn of Coming Supply Chain Disruptions
Farmers on the West Coast are warning of potential food shortages caused by inflation and drought, but now, some farmers are struggling to find feed because shipments are delayed.
"We have enough of corn to hold us off for a few more days, and then we’re going to be out as well," dairy farm owner Darlene Lopes said.
Lopes said she normally would buy corn throughout the week, but the shipments from her normal supplier have stalled, caused by a backlog of train shipments and a labor shortage.
"The primary challenge at hand is a labor shortage, which railroads are working to address through aggressive measures to attract new workers," Association of American Railroads Assistant Vice President of Public Affairs Ted Greener said. Read the Full Story
ASFMRA Government Relations Update
House Begins FY 2023 Appropriations Markups
The House of Representatives’ Appropriations Committee started marking up individual FY 2023 appropriations bills last week. The agriculture subcommittee completed its work on the FY 2023 bill and the full House Appropriations Committee will consider it this week. The Subcommittee print provides $75.443 million for the Risk Management Agency (RMA) Salaries and Expense (S&E) account. RMA S&E is funded at $62.707 million for FY 2022. The large increase is consistent with the Biden Administration’s request.
The Farm Service Agency (FSA) salaries and expenses are funded at $1.556 billion in FY 2023 compared to $1.488 billion in FY 2022. The Natural Resource Conservation Service (NRCS) would also receive a substantial increase in its Conservation Operations account (Salaries and Expenses essentially for NRCS), $1.034 billion compared to $904 million in FY 2022. The Senate has not started work on FY 2023 appropriations and there is no expectation that the appropriations process will be completed by the end of the fiscal year (September 30) or prior to the mid-term election.House Passes Agriculture Related Package
The House passed a package
of seven agriculture related bills called the “Lower Food and Fuel Costs Act”. The 7-bill package included a provision to create a special investigator’s office in USDA’s Packers and Stockyards Division to investigate the meat and poultry industry. Ranking Member Thompson (R-PA) raised concerns about the special investigator and said the bill did nothing to lower food or fuel costs. The vote was 221 to 204 with seven Republicans joining most of the Democrats to pass the bill. Five Democrats voted against it. The House Republicans who voted for the bill did so because of the ethanol related provisions with would allow year-round sales of E15 and would provide $700 million to USDA for funding biofuel infrastructure as well as assist farmers with nutrient management and precision agriculture.House Agriculture Committee Reviews Commodity Programs and Crop Insurance
The General Farm Commodities and Risk Management Subcommittee of the House Agriculture Committee heard from four agricultural economists as it reviewed the 2018 commodity title and crop insurance. Drs. Joseph Janzen, University of Illinois, Robert Craven, University of Minnesota, Ronald Rainey, University of Arkansas and Joe Outlaw, Texas A&M University were witnesses. You can read their written testimony here
and watch a replay of hearing here.
Many of the questions from committee members focused on high input prices and possible supply chain shortages. Ranking member Thompson (R-PA) asked how a margin protection plan for row crops, already in use by dairy farmers, would compare to the current commodity programs (ARC & PLC), which are triggered by low market prices. The four economists generally said such an approach would be better as it would take into consideration costs as well as revenue, but also recognized it would cost more money. Rep. Al Lawson (D-FL) asked about the idea of creating a permanent disaster program. Drs. Outlaw and Janzen said crop insurance generally was sufficient.House Agriculture Committee SNAP Hearing Foreshadows Farm Bill Debate
The House Agriculture Subcommittee Stakeholder Review
of the Supplemental Nutrition Assistance Program (SNAP) indicated what we can expect to be a contentious debate in the House of Representatives during the next farm bill. SNAP would cost $1.1 trillion over the next decade, according to the Congressional Budget Office (CBO). Ranking Member Thompson (R-PA), the next House Agriculture Committee Chairman should the Republicans take the majority after the midterm election, called such spending levels exorbitant and said his “concern that pandemic aid is morphing into endemic aid” through proposals to make permanent the emergency allotments authorized by Congress in pandemic relief packages. “To say I disagree with those calls is an understatement,” said Thompson. “We do not need to spend for the sake of spending. … [S]ometimes our best intentions cause irreparable hardship for families that we aim to help.”
House Agriculture Committee member and House Rules Committee Chairman Jim McGovern (D-MA) is a leading advocate for SNAP. He said it would be a “missed opportunity” if the temporary increases in SNAP benefits were allowed to expire. “Let me be clear: I will not support any farm bill that guts the nutrition safety net for millions of Americans. … We need to find way to strengthen the program.”Farm Bill Hearings Outside of Washington D.C.
The Senate Agriculture Committee completed its second farm bill hearing
in Arkansas last week. In addition, the House has scheduled a listening session in Arizona on June 25 at 11:00 a.m. MT at Central Arizona College in Coolidge, Arizona as well as a listening session at 11:00 a.m. PT at California State University, in Fresno, California on Thursday, July 7. These listening sessions are open the public if you’d like to attend.
Welcome New Members
Help us welcome our newest members to ASFMRA! We are thrilled that you have chosen ASFMRA as the organization to be affiliated with. Because of you, ASFMRA continues to grow and support rural property professionals across the nation!
We are recognizing new members of the Society on a monthly basis. You may recognize your colleagues in the following list and we encourage you to welcome them into ASFMRA!New Members
Christopher Abrahamson with Farm Credit Services of America in Sioux Falls, SD (South Dakota Chapter)
Nicole Allen with Allen Advisory Group in Midlethian, VA (Carolinas Virginias Chapter)
Jacob Aubry in Sycamore, IL (Illinois Chapter)
Clayton Becker with Farmers National Company in Omaha, NE (Nebraska Chapter)
Scott Donkers with R & S Appraisals, LLC in Faribault, MN (Minnesota Chapter)
Seth Gehman with Ag Appraisers, LLC in Mount Joy, PA (Northeast Chapter)
Mark Grassel with AgIs Capital in Ellensburg, WA (Washington Chapter)
Jordan Hook with Hertz Farm Management in Grundy Center, IA (Iowa Chapter)
Michael Janssen in Ackley, IA (Iowa Chapter)
Grant Kuppler with Martin Goodrich & Waddell in Hinckley, IL (Illinois Chapter)
Steven Piggott with Nuveen Natural Capital in Fresno, CA (California Chapter)
Michael Schorpp in Clive, IA (Iowa Chapter)
Jake Thomsen with Growthland in Marion, IA (Iowa Chapter)
Jon Walker with Farm Credit Southeast Missouri in Dexter, MO (Missouri Chapter)
Kyla Wright with Northwest Farm Credit Services in Ontario, OR (Idaho-Utah Chapter)
Share Your Experience - Make a Referral
You know first-hand what a great organization ASFMRA is and what it means to you both professionally and personally. We thank you for spreading the word, you are the driving force behind our continued growth! Talk to those you know who would benefit from ASFMRA’s educational offerings, networking, and meetings. Let them know your experiences of being involved in this great association and some of the business contacts you have made along with lasting friendships. Your peers listed below have done just that! They spoke to individuals about ASFMRA and those individuals have now become members of ASFMRA!
Steven Diedrich, AFM
Jeremy Hill, ARA
Jeffrey Hillberg, AFM
Peter Isaacson, AFM
Kenneth Schmitt, AFM
Gregory Snyder, ARA
Thank you to all who have referred someone and in some cases, more than one, to join ASFMRA.