8 Farmland Ownership Trends to Watch

Land Ownership Trends

A wide array of farmers, landowners, ag policy makers, lenders, and real estate investors met in early June to take a look at the current farm trends happening across the nation, and how US Ag Policy may need to adapt as a result of these changes. The meeting, hosted by the Farm Foundation, Bank of America/Merrill Lynch, and the USDA’s Economic Research Service, honed in on 8 specific trends that are shaping ag ownership trends not only across the US but for Nebraska farmland as well.

Trend 1: Overall, experts and farmers agree: Cash rent reductions are on the horizon. The current grain market situation is set to lower cash rents an additional 5 to 15 percent, according to farm economists.

Trend 2: Remember talk of land bubbles? Ag economists at the meeting held firm in their opinion that, despite softening farmland prices, most US farmers are in good shape, equity-wise, to deal with them. That’s not to say that situations are rosy across the board. According to ag economist and director of the University of Illinois’ TIAA-CREF Center for Farmland Research, the average debt-to-income ratio is still 6.8 to 1—levels nowhere near the levels experienced during the 1980s bubble burst, but still “storm warning level.”

Still, farmland is still seen as one of the highest-returning, safest investments, and indeed, with a 30 year average 10.5 percent rate of return on Iowa farmland, compared to just 8.17 percent for S&P 500, that seems like an accurate assessment.

Trend 3: While the land market is ripe for investors, nationwide there has been very little outside investment in agriculture, with 99 percent of farms and 90 percent of production resulted from family-owned farms.

Trend 4: A shift in ownership structures is occurring. Sherrick is seeing more separation of operators and ownership. Larger farms are taking on more complex business structures, and many operators are becoming multi-generational—a trend that will make it more difficult for federal programs and ag policy makers to define “farmer.”

Trend 5: An age disparity is being noted between farm owners and farm operators. While the average age of farm operators isn’t rising much, the average age of landowners is.

Trend 6: Similarly, the age of beginning farmers isn’t necessarily young. According to Jeffrey Hopkins of USDA ERS, older beginning farmers are the biggest portion of beginning farmers.

Trend 7: From an ag-policy stance, the next farm bill may be drastically different, with the potential for cotton to be replaced by soybeans as a core commodity. Soybeans have grown faster in acreage as well as in farm revenue than cotton in both the North and South.

Trend 8: The Farm Bills recently issued continue to shift focus to conservation, environmental concerns, crop insurance/risk management, and food/nutrition programs. According to extension ag and consumer economist at the University of Illinois Jonathan Coppess, “We need to find ways to expand the farm policy coalition to get favorable farm policies.” He hopes that the focus of the next Farm Bill will be redirected somewhere to the middle, instead of continually shifting left.

Do you have questions about ways to stay ahead in the current agricultural landscape? Feel free to contact a UFARM representative—we are glad to help you put together a plan of action that works for you.

Source consulted:  Vogel, John. “8 Farmland Ownership and Ag Trends Impact Future Farm Policy.” FarmProgress.com. Penton. 14 Jun. 2016. Web. 28 Jul. 2016.

UFARM Celebrates 85 Years of Service

Clifford Jorgensen - 1950

Clifford Jorgensen – 1950

As years go, 2016 is a significant one for the United Farm & Ranch Management team. July marked the 85th year of United Farm & Ranch Management service to agricultural landowners and operators in the state of Nebraska and neighboring states. UFARM is proud of its long and storied history and is eager to build on its experience and success in the farm management profession over the next 85 years and beyond.

Just as agriculture has undergone incredible changes over the last century, so too has the company that is now UFARM, although its goal has always remained the same: To help landowners and farm operators in the state make the most of their land and farms.

In 1931, First Trust Company in Lincoln, Nebraska began to offer farm management services under the supervision of Sam Waugh.  In 1939, Sam Waugh sent farm manager, Cliff Jorgenson to Norfolk, Nebraska to open a farm management office in the Norfolk Hotel.  Cliff successfully opened the office and began managing the 171 farms the company was serving in the area.

Jorgenson was elected Director of the Farm Management Department in 1950. After the company was bought by the National Bank of Commerce Trust and Savings in 1961, Jorgensen continued his role at NBC at the company’s building at 13th and “O” street in downtown Lincoln, where he acted as manager of the farm department until his retirement in 1974.

At this point, Keith Carlson stepped in to continue Jorgensen’s role as Farm Management Vice President at NBC. Then, in 1994, NBC sold the farm division to United Nebraska Bank, and the name changed to United Farm and Ranch Management (UFARM), as we know it today. The company continued to operate from downtown Lincoln as it became a subsidiary of TierOne Bank in 2004.

Then, in 2010, eight employees bought the company, and UFARM continued to fulfill its mission of serving landowners in its current form. Carlson became president until his retirement in 2015. Long-time UFARM employee, Chris Scow now serves as the managing broker and operations manager for the organization.

Overall, the hard-working UFARM team has over 254 years of combined experience in farm and ranch management and land sales—an impressive record, and one on which they are proud to stand.

It is this experience, combined with the dedicated attention that our land managers pay our valued clients, that keeps us inspired and motivated to continue and expand our services well into the future.

We appreciate our clients, and thank them for putting their trust in us over the past 85 years. We look forward to continue cultivating these relationships in the years ahead as we take a moment to celebrate our past.

UFARM offers a full range of Nebraska land management services, including real estate sales, rural property appraisals, consultations and crop insurance.  Contact us today!

Monitoring Nebraska Pasture Conditions

Nebraska-pasture

Things are heating up across the Cornhusker state, and many landowners are starting to turn their attention to the conditions of their pastureland as well as that of their cropland.

According to the latest NASS data, for the week ending July 10th, across Nebraska pasture and range conditions rated 2 percent very poor, 2 percent poor, 19 percent fair, 64 percent good, and 13 percent excellent—overall very favorable numbers. In fact, pasture conditions are now rated well above both last year and the five year average. Topsoil moisture supplies also rate favorable for this time of year.

As land values in all categories are in a downward trend, pasture- and rangeland are unique: Major cow-calf producing regions in Nebraska have reported small increases in value of around 10 percent for tillable and non-tillable grazing land, and hayland.

This fact, combined with the ongoing trend of higher cow-calf rental rates—record-setting in 2015—make closely monitoring the health of pasture-land a good idea for landowners. According to the 2015 UNL Nebraska Farm Real Estate Market Survey, per-acre rental rates reported an average increase of about 15 percent, with cow-calf rental rates averaging about $50 per month, or $250 for the 5 month season.

Keeping a close eye on rangeland conditions is important, according to UNL Extension Educator Bethany Johnston. Whether it’s to document pasture health for cattle grazing, wildlife habitat, or for NRCS programs, knowing the conditions of the land is advantageous to landowners in their decision making.

According to UNL Extension Educators, monitoring is key to rangeland and pasture management, and having a plan in place to measure changes in the land help landowners reach their overarching goals. Keeping records of precipitation, vegetation, and grazing is all part of that process.

For landowners, checking the conditions of their pasture may now be easier with the introduction of a new app, available on both Android and iOS devices, for use on tablets and mobile phones. Called “GrassSnap,” the app provides the following services:

  • takes ranchers through the monitoring steps;
  • stamps the photographs with the pasture name, GPS location, date, and direction looking;
  • records comments about each pasture;
  • stores the photographs and data in pasture folders; and
  • can quickly download the information to a computer.

Extension Educator and app developer Cindy Tusler says the app helps landowners collect and upload data in an organized manner, using GPS for precise location markers.

“This is a decision support tool. It will give you easily repeatable information that helps you make decisions. It doesn’t make the decision,” Tusler said.

Johnston adds, “Each person’s management goals are different, so monitoring and assessment will flow out of those goals. The app makes it easier to remember and compare conditions from one year to the next at exactly the same site.”

How do you feel about the conditions of your pastureland? Do you have a monitoring plan in place? If you have any concerns regarding pastureland management, don’t hesitate to contact a UFARM representative.  UFARM offers a full range of Nebraska land management services, including real estate sales, rural property appraisals, consultations and crop insurance. UFARM has operated in Nebraska since the early 1930’s. Contact us today!

Sources consulted:  Johnston, Bethany. “Monitoring Pasture Condition? UNL Has an App for That.” UNL Beef. University of Nebraska-Lincoln. Jun. 2014. Web. 13 Jul. 2016.  “Nebraska Pasture Conditions Exceed 2015 Levels.” Nebraska Ag Connection. USAgNet. 03 May 2016. Web. 13 Jul. 2016.

Nebraska CRP Acres in High Demand

CRP Acres

Farmers and landowners continually look for ways to make the most of their farming operations. Whether they focus on advancing technology, better machinery, or new irrigation techniques, increasing their bottom line is an ever-present pursuit. For many landowners in Nebraska, enrolling a portion of their farmland in the Conservation Reserve Program (CRP) is a good way to diversify their land asset while also benefitting the environment and preserving the integrity of their ground. Recently, however, it is proving much more difficult for Nebraska landowners and farmers to get their acres enrolled in the federal program due to such high CRP demand in Nebraska and across the Midwest.

The Conservation Reserve Program is a land conservation program that offers an annual rental payment and cost-sharing to landowners who agree to remove the selected piece of land from agriculture production and agree to incorporate certain types of beneficial plant species to the land. The CRP’s long term goals are to improve environmental and water quality, prevent soil erosion, and improve natural wildlife habitat. A typical CRP contract lasts 10-15 years.

The CRP is administered through the local Farm Service Agency (FSA) office. The USDA periodically holds a general signup for entering land into the program on a competitive basis, based upon environmental ranking and cost. The general sign up is announced by the Secretary of Agriculture, but there is no set schedule.

This year, Nebraska farmers who attempted to enroll some acres into the 49th general CRP program signup were likely met with disappointment: only 411,000 acres of the 1.8 million acres offered were actually enrolled—a 23 percent acceptance rate, marking it as the most selective round ever in the history of the program. For reference, in 2013, the USDA accepted almost 90 percent of the acres offered.

Why the low acceptance rate? The 2014 farm bill established a cap on the program of 24 million acres—a number that is 35 percent below the peak enrollment of 36.8 million acres, achieved in 2007. The lowered cap occurred when policy makers were confident that the higher commodity prices farmers enjoyed had also lessened their interest in enrolling those profitable acres into CRP, resulting in budgetary savings for government.

The story has changed, of course, and in the face of declining crop prices, farmers are once again looking for ways to make a profit, and the CRP program is one option: The prospect of receiving a rental payment for CRP land for a number of years is seen as a viable option for many landowners in the country.

USDA secretary Tom Vilsack says, “When Congress begins to deliberate the 2018 farm bill, they’re going to be faced I think with a demand to rethink the cap on CRP. The deliberation should not begin with ‘You have to save an artificial dollar amount,’ but it should really look at what the demand and need is.”

Are you looking for ways to make your land investment more profitable? Feel free to contact us at UFARM—we are experts at helping landowners reach their goals!

Sources consulted:  Mercier, Stephanie. “Why is the Conservation Reserve Program ‘Trending’ Again?” Agweb.com. Farm Journal. 13 May 2016. Web. 29 Jun. 2016. Wiklund, Jared. “Record Landowner Demand for CRP Met with Extremely Low Acceptance Rate.” Pheasants Forever.org. Pheasants Forever. Web. 29 Jun. 2016.

Where are Grain Prices Headed?

Grain Prices

 

Ahead of the three day holiday weekend, the USDA released its quarterly Acreage and Grain Stocks reports, and Nebraska landowners and producers hoped that the numbers would play out favorably for commodities prices. Unfortunately for corn prices, the report indicated far more corn acres planted than previously stated in March, resulting in another slump in prices. This came as a surprise to many analysts, who had expected a decline in corn acres from the March numbers.

Soybean stocks, too, came out higher than expected, though the market reaction was the opposite of corn, with soybean prices higher immediately following the June 30th numbers. The weather then abruptly changed that outcome and soybeans began a significant drop in prices after rains moved across the Midwest during the fourth of July weekend.

Looking more closely at the actual report numbers, corn planted is estimated to stand at 94.1 million acres, up 7 percent from last year, and the third highest planted acreage in the US since World War II. Area harvested for grain was also up 7 percentage points at 86.6 million acres, also the third highest number since 1933.

The corn numbers were also a half-million more acres than March estimates, when corn planting intentions stood at 93.6 million acres. Corn stocks, at 4.72 billion bushels, were also higher than the average trade guess of 4.52 billion bushels.

Soybeans reflected a similar story, with planted acres at a record high 83.7 million acres, up 1 percent from last year’s numbers, but less than the trade estimate of 83.8 million acres. This number is also up from the March Prospective Plantings report, which estimated 82.2 million soybean acres to be planted. Area for harvest stands at 83.0 million acres, up 1 percent from last year, and soybean stocks were also higher than expected at 870 million bushels versus the trade guess of 829 million bushels.

Similar stories for both corn and soybeans should mean similar market reactions. However, this wasn’t the case, with corn prices moving down 11 to 14 cents, and soybean prices up 40 cents. The divided reaction, according to grains analyst Jerry Gulke, reflects which crop is in the stronger position. Underlying fundamentals for beans, globally, are stronger, and the market apparently isn’t worried about a corn shortage any time soon.

Looking ahead, as far as market prices are concerned, experts agree that weather will be key in determining any effects on yields and prices, and if the current grain market trends will continue. A weather problem could spell a market bounce for corn, and could have major affects on beans, especially during August.

“It may be too late to kill corn, then, but if we get too hot in beans, we could easily lose 150 million bushels to 200 million bushels in bean production from a minor weather problem,” Gulke said. “The market does not want that to happen. They are really nervous about this.”

How are you positioned at the midpoint of the growing season? Were you surprised by the report’s latest numbers? Always feel free to contact UFARM with your questions or concerns. We look forward to working with you to make the most of your farming operation.

 

Sources consulted: Beachy, Debra. “Weather Next Big Question for Markets.” Agweb.com. Farm Journal. 06 Jul. 2016. Web. 07 Jul. 2016., Rice, Alison. “Gulke: Report Reaction Reveals Soybeans’ Strength.” Agweb.com. Farm Journal. 30 Jun. 2016. Web. 07 Jul. 2016., Rice, Alison. “The Essential Numbers in USDA’s June 30 Reports.” Agweb.com. Farm Journal. 30 Jun. 2016. Web. 07 Jul. 2016.

Inheriting Nebraska Farmland: Know Your Options

Inheriting Nebraska farmland

When it comes to most things in life, the saying “Know your options, or you don’t have any” is generally correct. This is certainly true for those who find themselves the inheritors of farmland. While oftentimes these recipients are already farmers themselves, it is increasingly common for non-farm children to receive land as an inheritance after their parents pass away. Suddenly, they find themselves facing decisions that may be completely foreign to them.

As the age of current farmland owners continues to increase, more and more people will find themselves in this situation. According to recent census data, the average age of farm operators was 57, with the fastest growing group of operators over 65. Landlord age is increasing as well.

Often, farms are jointly inherited by multiple parties—which may include both farm and non-farm children, a circumstance that often muddies the waters, especially should the deceased have inadequate estate planning in place.

For many people inheriting land, no matter their circumstance, enlisting the help of a professional farm management team is the first step toward successfully managing their new investment. Farm managers are proficient in such matters as determining the land’s worth and having it appraised, the ins and outs of land ownership type and how this affects the land’s management, whether or not the land should be sold and the consequences of doing so, explaining types of leases and helping negotiate them, determining the best way to manage the new ground, and many more key details.

A farm manager’s first action in helping inheritors of land is evaluating it: What is its location, and how does this affect the land’s current, best, and future use? What is the properties potential income based on its location? Is the land’s current use its best use?

After this, farm managers help assess the value of the land. Many are certified appraisers, and are able to provide a full, detailed appraisal of the farm.

A large part of inheriting land is knowing how to deal with inheritance and estate taxes that are incurred following the inheritance. Our farm managers are well prepared to help find expert accounting and legal.

After these initial determinations are made, farm managers then help you decide your farm options. Whether it’s to farm the land yourself, sell the land, or to keep the farm as an investment, knowing the options available to you in each instance is important. In each case, farm managers are able to guide you in the best direction in a way that will fit your individual needs and long-term goals.

In short, the decisions that accompany land inheritance are many and varied, and knowing that a knowledgeable person is helping you navigate these waters provides great peace of mind for inheritors. UFARM farm managers are motivated to listen to your needs and concerns about your farmland inheritance—feel free to contact us at any time.

 

Source consulted: Duffy, Michael D. “Getting Started In Farming: Inheriting a Farm.” Iowa State University Extension and Outreach. Iowa State University Extension. Web. 22 Jun. 2016 “So You’ve Inherited a Farm—Now What?” University of Nebraska-Lincoln CropWatch. University of Nebraska-Lincoln Institute of Agriculture and Natural Resources. 06 Apr. 2016. Web. 22 Jun. 2016.

 

Nebraska Planting and Crop Condition Update

Nebraska Crop Conditions

Nebraska planting is almost complete, just in time for the summer heat to kick in. According to the USDA’s National Agricultural Statistics Service’s (NASS) latest crop progress report for the week ending June 12th, 97 percent of soybean acres in the state were in the ground, with 99 percent of corn emerged. 

With average rainfall reported in most areas, the temperatures the past week averaged 6 to 8 degrees higher than normal, with more hot temperatures expected this week. Although corn grows well under hot, humid conditions, growers are hoping to see some more rainfall in the coming weeks to keep irrigating to a minimum.

Looking solely at Nebraska crop progress, the report showed that progress was, for the most part, ahead of last week, last year, and ahead of the past 5 year average for all major Nebraska crops. Corn emerged is at 99 percent, 9 percentage points ahead of last week and 4 ahead of last year. 

Soybeans are 97 percent planted, well ahead of last year’s 89 percent, and in line with the 5 year average. Soybeans emerged are at 84 percent, well ahead of last year’s 73 percent, though lagging slightly behind the 5 year average emergence of 86 percent for this week. 

As for moisture conditions, topsoil moisture supplies rated 2 percent very short, 23 percent short, 70 percent adequate, and 5 percent surplus. Subsoil moisture supplies rated 0 percent very short, 12 percent short, 82 percent adequate, and 6 percent surplus.

Crop conditions across the Cornhusker state are doing well. The report showed corn rating at 1 percent very poor, 2 percent poor, 18 percent fair, 67 percent good, and 12 percent excellent.   

Soybean conditions followed suit, with 0 percent rating as very poor, 2 percent poor, 19 percent fair, 69 percent good, and 10 percent excellent. 

Hay growers are off and running, with the first alfalfa cutting at 81 percent complete across the state, well ahead of last year’s 50 percent marker and the 61 percent 5 year average. Alfalfa stands are in good condition, with 2 percent rating very poor, 3 percent poor, 10 percent fair, 70 percent good, and 15 percent excellent. 

Our UFARM managers are reporting that throughout the eastern half of the state the hot temperatures have contributed to very rapid crop growth, although rainfall is beginning to be at a premium, with very spotty rainfalls being reported. However, top- and subsoil moisture conditions are still adequate for the time being, and there are no major crop pest problems to contend with as yet for most areas. 

As stated earlier, however, temperatures this week and into the weekend are forecasted to be in the high 90s, with little chance for rain for most of the state, and growers are anticipating the need to turn on their pivots, have they not already. 

Source consulted:  “Nebraska Crop Reports 2016.” CropWatch. University of Nebraska-Lincoln. 15 Jun. 2016. Web. 16 Jun. 2016.

Current Farm Economics 

 

Nebraska Land Manager

It’s no secret to farmers and landowners that current farm economics are tough. Profit margins are tight this growing season, and myriad reports corroborate this fact. From 2011-14, US farm income experienced a golden period, driven by good commodity prices and strong exports.

Now, according to the Congressional Research Service’s 2016 Farm Income Outlook, it is projected that exports are set to be 6 percent lower from 2015 and well below 2014’s record $152.5 billion, a fact attributed to a strengthening US dollar and weakening economies in several major foreign import countries, including China.

The report also found that national net farm income is also projected to be down—$54.8 billion in 2016—a 3 percent decline from last year. This means that US farm incomes, a key indicator of US farm well-being, will be the lowest since 2002, and is the third year in a row that farms have experienced a decline.

As Nebraska farmers and landowners can attest, land values comprise a significant portion of a farm’s asset base. As such, a change in farmland values is an important gauge of a farm’s finances. Naturally, lower farm incomes mean lower land values, and in this way, the report found that overall farm wealth is likewise set to decline for the second straight year, about 2 percent from 2015.

In this way, reports have found that farmland values of both non-irrigated and irrigated cropland decreased 4 and 2 percent respectively, from 2015. It is expected that cash rents, too, will decrease in 2016, this according to the University of Illinois’ Gary Schnitkey

“However,” Schnitkey says, “projected rent decreases are not large enough to cause farmers to have positive returns in 2016 given current projections of commodity prices and costs. The lagged relationship between returns and cash rents still exists.”

While the outlook is most certainly a pessimistic one, there is always a small silver lining—a mild decline of 3 percent in farm cash expenses in 2016 is expected. Government payments from the 2014 farm bill in the form of revenue support programs are also expected to trigger payments upwards of $9 billion in 2016.

Overall, though, farmers are resilient. Paul Pittman, CEO of Farmland Partners Inc. says that, as tight as things are getting, “Farmers won’t see the same kind of economic crisis they did in the 1980s.” After years of high prices, and only very slight increases in interest rates, most farms in the US are in better financial shape in which to weather the storm.

In summary, the reasons for the tough times are many—production outpacing consumption, a strong US dollar’s effects on exports, lower commodity prices, and a drop in land values—but all boil down to the fundamentals of supply and demand. In a world with a growing population, people must eat, and farmers optimistically hope to weather through this storm until the scale tips in their favor once again.  The recent uptick in soybean prices is a positive sign and corn is trending upward as well.  The summer weather is the wildcard that no one can predict for sure.

Sources consulted:  Bjerga, Alan. “The Crop Surplus is Bad News for America’s Farms.” Bloomberg.com. Bloomberg. 11 Jan. 2016. Web. 23 May 2016.  Schnepf, Randy. “US Farm Income Outlook for 2016.” Fas.org. Congressional Research Service. 16 Feb. 2016. Web. 23 May 2016. Wright, Kevin. “Tightening in the Ag Belt.” KansasCityFed.org. Federal Reserve Bank of Kansas City. Spring 2016. Web. 23 May 2016.

El Nino’s Potential  Effects on Crops in 2016

2016 Nebraska Crop Yields

There’s no question that this spring’s planting season continues to be a long, drawn out process, due mostly to increased rainfall activity that has prevented farmers from getting into the fields for more than a day or two at a time. This is largely attributable to the strongest El Niño weather pattern on record since 1997. El Niño is the term used when equatorial-region Pacific Ocean temperatures reach a level of 0.5 degrees Celsius above normal for a sustained period of at least several months. In an El Niño year, those in the central section of the US can expect warmer than average temperatures combined with above average precipitation.

While climate experts did predict a warmer, wetter spring, they were half right, at least here in Nebraska: Nebraska farmers have dealt with higher than normal rainfall, but the warmer temperatures have yet to materialize, despite warmer temperatures in the first half of March.

So how will this strong El Niño pattern continue to affect corn and soybeans during the growing season? Will the strong weather pattern have an impact on corn and soybean yields and a shift in the planting window?

A team of climate scientists set out to try to better understand the potential impacts that El Niño could have on agriculture production in the Midwest, focusing on potential effects on corn and soybeans in Iowa, Illinois, and Indiana.

What they discovered is that there should be little to no adverse yield-related effects. Of the five strongest El Niño events they looked at, the combined yields during those years were either average or slightly higher. They discovered that much of the weather events attributed to El Niño are hyped up, and that, barring any other sort of unforeseen weather-related events or plant challenges, farmers should be able to expect an average harvest.

Jerry Lehnertz, vice president of lending at AgriBank Farm Credit Bank agrees.

“History shows that it’s uncommon to have subpar national crop production results for corn and soybeans except in the few cases where very hot, dry weather occurs during the critical crop development phase in June and July,” Lehnertz says. “If predictions are correct, this could signal higher-than-expected corn and soybean yields this year.”

As far as marketing and risk management goes, Lehnerz recommends that farmers “adjust marketing and operations plans based on short- and long-range weather forecasts, and ensure [they] have appropriate risk-management tools in place to guard against potentially extreme weather.”

On the other hand, climatologists are seeing indications that the El Niño pattern could rapidly reverse to a strong La Niña pattern. Kyle Tapley, senior agricultural meteorologist for MDA Weather Services says that several models now show full-fledged La Niña conditions by the summer.

Nebraska Associate Climatologist Al Dutcher says, “The big question is when we transition from an El Niño to a La Niña type pattern. That will dictate whether it is a dry year.” According to Dutcher, it’s likely the switch will occur in the second half of the growing season.

Do worries about your agricultural land keep you on edge? Feel free to contact UFARM—we are glad to help you plan for these challenging times in agriculture, while keeping your goals moving forward.UFARM offers a full range of Nebraska land management services, including real estate sales, rural property appraisals, consultations and crop insurance. UFARM has operated in Nebraska since the early 1930’s. Contact us today!

Nebraska Planting Progress and WASDE Report Analysis

Cornfield-with-puddle

Continued rain events have hampered efforts’ in the fields for many farmers in the major planting states so far, although significant gains were made in the last week.

Monday’s USDA Crop Progress Report for the week ending May 8 saw 64 percent of the nation’s corn planted, in comparison with 45 percent last week. This measures up as slightly behind last year’s corn planting at 69 percent, though well ahead of the 5 year average of 50 percent.

In Nebraska, rain delays were especially felt, though Cornhusker State farmers made incredible strides in the last week: As of Sunday, 53 percent of the state’s corn was in the ground, compared to only 26 percent last week at the same time. This is still behind last year’s 71 percent benchmark, and slightly behind the 5 year average of 59 percent.

It’s a similar story both nationally and statewide for soybeans. Overall, 23 percent of soybeans are planted, slightly behind last year’s 26 percent, though well ahead of last week’s 8 percent, and the 5 year average of 16 percent of beans planted.

Nebraska soybeans are 13 percent planted, behind last year’s 21 percent, and the 21 percent 5 year average. In comparison with last week’s 2 percent, however, Nebraska farmers were evidently  able to get into the fields to plant beans at some point.

Overall corn emergence stood at 27 percent, ahead of last year’s 23 percent and ahead of the 17 percent 5 year average. In Nebraska, corn emergence was at 15 percent, in line with the 5 year average, though behind last year’s 24 percent.

Of the 18 states that make up the report, Minnesota, Iowa, and Illinois made the most progress, and while Indiana leads in the slowest progress category due to continued rain delays. The report found that 6 other states remain behind 5 year averages: Colorado, Michigan, Nebraska, North Carolina, Ohio, and South Dakota.

The Tuesday, May 10th WASDE Report was expected to be bearish on the grain markets, with estimated corn stocks increasing to 2.3 billion bushels, due to  higher corn acres and trending yields of 168 bushels per acre. New crop soybeans were expected by analysts to be similar to last year’s figure of 440 million bushels. However, that analysis was way off and traders were surprised. The carryover for new-crop bean was 305 million bushels, which caused soybean futures to take off and increase 60 cents a bushel at one time. In addition to the lower carryover,  heavy rainfall in South America and its negative effects on production there continues to be one of the main factors for the more favorable grain markets.

Amid the fluctuating markets, farm economists continue to urge those marketing crops to manage their risk.

“It’s going to be extremely difficult to try to outguess these markets,” according to Mike Mock of The Andersons Grain Group.  

 

Sources consulted: “Analysts: USDA Report Could Bring Out Bears.” AgWeb.com. Farm Journal. 09 May 2016. Web. 10 May 2016. “Crop Progress.” NASS/USDA. USDA. 09 May 2016. Web. 10 May 2016.