GFM attends AgroNomics 2016

Ted Glaub, Jeffrey Hignight, and Houston Matthews traveled to Indian Wells, CA to attend AgroNomics 2016 the week of November 7th.  The theme was “Performance under Pressure.”

Steve Elmore, chief ag economist for DuPont Pioneer indicated the current commodity prices will be around for a while.  He projects soybean acres will go up while corn and wheat acres will go down.  This acreage shift more than likely will put downward pressure on soybeans prices but help stabilize other crops.  Some folks are projecting crop price rebound next year but Dr. Elmore thinks their projections will be wrong.  In addition Dr. Elmore thinks oil prices will stay low due to efficient extraction capabilities.  This will put huge pressure on OPEC countries relying on strong oil prices to prop up their social programs.

Good or bad politics is part of the agricultural equations.  Mary Kay Thatcher, senior director of congressional relations for the American Farm Bureau Federation (AFBF) discussed how Washing DC has changed over time and we can expect gridlock to continue.  The 2018 Farm Bill is already in the spotlight and there are forces in play to split nutrition from the Farm Bill while others want to eliminate/significantly reduce commodity and crop insurance programs although agriculture and conservation programs equal less than 20% of total Farm Bill expenditures.  Stephen Frerichs, AgVantage, LLC also gave a legislative update and discussed current and projected Farm Bill outlays and his thoughts on how a Trump administration will view agriculture and trade.

Water regulation is always a hot item due to runoff from the farm and heavy reliance on water for crop production.  Kristine Tidgren, assistant director for the Iowa State University Center for Agricultural Law and Taxation provided an update on the Des Moines Board of Water Works lawsuit and other Clean Water Act lawsuits and regulations.  Lawsuits such as the Des Moines Board of Water Works against drainage districts will have major implications across the US if successful.  Trump campaigned with a promise to eliminate burdensome water quality regulations.  If followed through, the agriculture industry should be in a better position to stay profitable and competitive while being good steward of the land.

Drones, Drones, Drones!  These machines are the hot topic in agriculture.  Leonard Meador, AAC discussed hot to utilize drones in management and appraisal capacities to improve analysis, reporting, and business decisions.   The drawback is learning to fly and land the drone in addition to obtaining the “remote pilot airman certificate” from the FAA for legal business use.

The concept of precision technology in agriculture has been around since the 1980’s.  Availability and usability is beginning to be much easier.  Precision technology will allow production to place the right product and amount in multiple management zones within a field.

Trade is very important to agriculture and was discussed.  Cuba in particular is a new and potential market for US goods and services.  Cuba and the USA have very strong cultural relations but the political and economic relations have been strained.  The process of political and commercial reform will be slow.  The strong focus of the Cuban government will be to improve their agriculture.

Shawna Lemke, Ph.D. with Monsanto discussed opportunities for agriculture to engage the public about how food is produced.  Many misperceptions exist about agriculture production and the crops produced.  Food companies and all of the stakeholders within agriculture have to promote how the industry is producing more with less while keeping products safe.

To wrap up AgroNomics, Dr. Mark G. Dotzour discussed his outlook on US jobs, interest rates, and international markets.  The synopsis is that the US economy is in the 6th inning (baseball terms).  The economy will continue to grow before any slowdown occurs.  The US is in much better shape than all of our competitors.  Because of this, investment flows will still be to the US keeping interest rates low for time to come.  In addition, Dr. Dotzour predicts we are about to go into high gear with housing as the Millennia generation look to purchase their first home.