January 26, 2023 at 5:02 p.m.

Ag economy challenged by macro conditions

By Don Wick- | Comments: 0 | Leave a comment

Rabobank global strategist Stephen Nicholson said agriculture is suddenly getting much more complicated. “We’ve got complicated markets, but you have these macro-economic things that are coming in,” Nicholson said. “I look at the money supply situation and realize it is no wonder inflation is where it is with so much money in the system; you have the classic situation of more buyers than sellers.” Higher interest rates will likely be a reality for some time.

Climate politics, monetary policy do not mix
Environmental groups have asked the Federal Reserve to actively address climate change. Fed Chairman Jerome Powell responded in a panel discussion with other central bank officials, saying the Fed must avoid drifting into political issues that aren’t directly involved with its work on economic policy. Powell said the Fed is not and will not be a “climate policy maker.”

Major philosophical differences
Agriculture has big issues on the docket in Washington. That list includes the use of farm program dollars versus conservation spending. “The administration is still pushing their 30×30 plan where they want to see 30% parked off over to the side into conservation initiatives,” said Jay Truitt, president, Policy Solutions. “Those things are real philosophical battles.” Other issues that will be addressed include packer ownership of animals, foreign ownership of land and crop insurance. Truitt expects all of these issues to be addressed within the context of the farm bill.

Farm Bureau delegates complete policy book
American Farm Bureau Federation Vice President Scott VanderWal oversaw the resolution process at the group’s annual convention. “Our delegates voted to modernize the farm bill by expanding baseline funding and developing more flexible disaster relief programs,” VanderWal said. “They also voted for more transparency for the federal milk marketing pricing system.” VanderWal, who also serves as the South Dakota Farm Bureau president, said labor shortages were addressed at the convention. “Right at the top of the list is labor issues and immigration, specifically, fixing our H2A system,” he said.

Right-to-repair MOU signed
The American Farm Bureau Federation and John Deere have signed a memorandum of understanding, giving farmers the right to repair their own equipment. Farm Bureau President Zippy Duvall made the announcement at the organization’s convention in Puerto Rico. “This agreement will enable you and your independent mechanics to identify and fix problems,” Duvall said. “You will have access to the diagnostic tools and information that you need, and you’ll get it all at a fair and reasonable price.” It took years of negotiations to secure this agreement. Discussions with other equipment manufacturers have already begun.

A supply-demand tug of war
The used machinery market remains hot. BigIron Auctions territory manager Eric Kaczmarski said tight supply will continue to keep used machinery prices high. “Prices will remain strong as long as customers still struggle to get equipment at dealerships,” Kaczmarski said. He said BigIron Auctions is coming off a record year. “Our sales were through the roof, and we were constantly breaking records every week,” he said.

DBA highlights policy priorities
The Dairy Business Association has outlined its 2023 budget and legislative priorities. The Wisconsin dairy group supports clean water initiatives, improving the Confined Animal Feeding Operation program, rural road funding, updating the farmland preservation tax credit and updating the commercial driver’s license-Schedule F. “DBA firmly believes in common-sense policy that moves Wisconsin forward,” said Amy Penterman, president. “Starting a new budget cycle presents opportunities to improve programs that work for dairy farmers.”

Nitrogen optimization grants available
The Wisconsin Department of Agriculture, Trade and Consumer Protection will accept applications for its commercial nitrogen optimization research grants until the end of the month. There is $1.6 million in funding available for this round. Farmers applying for the grant must agree to collaborate with the University of Wisconsin on this project and voluntarily conduct commercial nitrogen optimization field studies for at least two years.

Buhr appointed to natural resources board
Viroqua dairy farmer Paul Buhr has been appointed to the Wisconsin Natural Resources Board. Buhr replaces William Bruins, who resigned from the board at the end of 2022. In a statement, Wisconsin Gov. Tony Evers said Buhr is “a strong advocate and champion for land and water conservation and understands that protecting our environment and family farms is a priority for Wisconsin’s future.”

AFBF honors Moore
Former American Farm Bureau Federation Executive Vice President Dale Moore was presented the group’s Distinguished Service Award. Moore served in that role from 2018 to 2022. Moore was chief of staff for four agriculture secretaries and was the staff of former Kansas Sen. Pat Roberts.

WFBF adds Mugnaini to staff
The Wisconsin Farm Bureau Federation has hired Jason Mugnaini as its executive director of governmental relations. Most recently, Mugnaini was chief of staff for Wisconsin Sen. Robert Cowles.

No reelection bid for Stabenow
Senate Agriculture Committee Chair Debbie Stabenow does not plan to run for reelection in 2024. The Michigan lawmaker said she will help guide passage of the next farm bill. Stabenow chaired the ag committee from 2011 to 2015 and took over the job again in 2021.

Fuess named senior dairy analyst
Lucas Fuess has joined the RaboResearch Food and Agribusiness team as a dairy industry research analyst and economist. Previously, Fuess was the director of dairy market intelligence at HighGround Dairy.

New CEO for Organic Valley
Organic Valley has named Jeff Frank as its new CEO. Bob Kirchoff is retiring, and his last day with the co-op is Jan. 31. Frank has had a 25-year career with Hormel Foods.

Trivia challenge
Caseiculture is the craft of making cheese. That answers our last trivia question. For this week’s trivia, what is the dish featuring fries, cheese and gravy? We will have the answer in the next edition of Dairy Star.
  Don Wick is owner/broadcaster for the Red River Farm Network, based in Grand Forks, North     Dakota. Wick has been recognized as the National Farm Broadcaster of the Year and served as president of the National Association of Farm Broadcasting. Don and his wife, Kolleen, have two adult sons, Tony and Sam, and five grandchildren, Aiden, Piper, Adrienne, Aurora and Sterling.


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