Monthly Archives: May 2014

K-State Agricultural Lender Survey: Start of 2014 Shows Expected Increases for Future Ag Lending

Agricultural lenders indicated less optimism early this year than they did near the end of last year, according to the results of the March 2014 K-State Agricultural Lender Survey. Lenders were not as optimistic as they were in the fall 2013 survey, although one area of continued optimism is farm loan volume. Results show that respondents expected an increase in interest rates, farm loan volume and non-performing loans, and land values are expected to decrease.

Allen Featherstone, interim department head and professor of agricultural economics at Kansas State University, said the survey gives farmers an idea of the current and future state of agricultural credit conditions. As with the survey conducted in the fall of 2013, the purpose of the spring 2014 K-State Agricultural Lender Survey is to not only answer questions about the evolution of agricultural credit conditions, but also to provide a broader overview of all agricultural lenders.

There were noticeable differences between the spring and fall survey responses, Featherstone said.

  • Interest rates are expected to increase in the short term and long term, while the spread over cost of funds is expected to increase in the long term. Loan interest rates for farm real estate rose slightly, but decreased slightly for operating loans.
  • Land prices continued to increase in the last three months, although future expectations have weakened since the last survey. The current survey shows expectation for the short and long run suggest more sentiment that land values will fall than expressed in the fall 2013 survey. More respondents expect land prices to decrease during the next year than those who expect it to increase.
  • Although agricultural lenders indicated that they were not as optimistic as they were in the fall of 2013, one area where they were optimistic was farm loan volume. Lenders indicated that they expect farm loan volume to increase for all categories. The sentiment that non-performing loans will rise also increased as respondents indicated that they expect non-performing loans to increase in the short and long term.

For more information about the outlook for agricultural credit conditions and commentary on areas of concern within agriculture, go to the K-State Agricultural Lender Survey http://www.ageconomics.ksu.edu/p.aspx?tabid=705 .

The survey was developed by K-State’s Department of Agricultural Economics’ Brady Brewer, doctoral candidate; Brian Briggeman, associate professor and director of the Arthur Capper Cooperative Center; Allen Featherstone; and Christine Wilson, professor and assistant dean of academic programs, for the College of Agriculture.

 

K-State Research & Extension News

For more information:
Dr. Allen Featherstone – afeather@ksu.edu or 785-532-4441

Written by: Kali Roberts and Amanda Erichsen
aerichsen@k-state.edu
Department of Agricultural Economics
www.ageconomics.k-state.edu

Worth the Weight: Gain projections for feeder cattle and herd expansion

A K-State livestock economist talks value of gain projections for feeder cattle in the coming months, as well as nationwide beef herd expansion.

May 20, 2014 – The current environment for the beef industry includes a limited supply of feeder cattle and stable consumer demand for beef, said Glynn Tonsor, livestock economist for Kansas State University. The environment is driving record high prices for cattle.

Many producers and commercial stockers are likely debating the best time to buy and sell calves. Tonsor said those who have the feed resources available should consider putting extra weight on the calves prior to selling.

“Today, someone who might have weaned a fall steer and have a 700-pounder around today will entertain selling him,” he said. “But, if you are in a situation where you still have something to feed the steer and you could put an additional 50 pounds on him, the market is strongly encouraging you to do that.”

In this example, Tonsor pointed out that the feeder cattle market in June compared to May looks to be higher. If the steer sells at a higher price in June when he is 50 pounds heavier, the value of gain (VOG) is projected to be more than $2, around $2.11, which could well exceed the cost of gain (COG) for producers who have access to feed resources.

For producers who will be weaning calves this fall, or commercial stockers looking to purchase weaned calves, consider this—putting an additional 200 pounds on calves could have a VOG around $1.20. That’s comparing selling calves at 550 pounds in late September to selling them at 750 pounds in late December.

“Most people will have a COG close to a buck, or a little bit lower, so there are positive margins being projected there as well,” Tonsor said.

Tonsor used www.beefbasis.com as a resource for figuring VOG projections. He recommends that producers visit K-State’s Ag Manager website at www.agmanager.info, where they will find links to the Beef Basis website and Livestock Marketing Information Center’s website (www.lmic.info). These resources allow cattle buyers and sellers to view market reports and compare costs.

What about herd expansion?
While many cow/calf producers are taking advantage of selling with current high feeder cattle prices, many are also looking to expand the herd following a few years of extensive drought. Tonsor said despite high prices, there is evidence that the industry is trying to expand by retaining heifers and not culling as many cows.

In the first quarter of 2014 on a nationwide basis, he said, there has been a notable reduction in the portion of feedlot placements represented by heifers, which indicates they are staying on a farm or ranch somewhere.

“The magnitude is in line with 2006, the last time we tried to expand the herd,” Tonsor said.

Herd expansion is also reinforced when examining slaughter data, he said. Cow slaughter is down compared to last year, but this could be partly due to fewer cows available to send to market. Steer slaughter is slightly down, depending on the week, compared to last year. Heifer slaughter is way down from a year ago.

“I think there are a lot of signals that the industry as a whole has pulled the trigger on expansion,” Tonsor said. “Time will tell how much, but we are trying to expand in aggregate nationwide. Maybe Texas, the Oklahoma Panhandle and California are not participating (due to continued drought), but expansion is occurring in other spots.”

Nationally, there is less pasture and range acreage in poor and very poor condition compared to last May, according to the U.S. Department of Agriculture’s Crop Progress Report (http://usda.mannlib.cornell.edu/MannUsda/viewDocumentInfo.do?documentID=1048). But, Tonsor said U.S. pasture and range condition is still worse today than the five-year average prior to 2013.

He added that there are fewer cows located in poor and very poor condition areas currently. Only 7 percent of cows in the United States are in reported poor or very poor areas today, compared with 52 percent in 2013.

“I don’t want to dismiss the fact that there are pockets in a lot worse condition, but many areas are in better condition compared to 2013,” Tonsor said. “This facilitates the national story of some heifers staying at home and producers trying to expand.”

 

Story by: Katie Allen | katielynn@ksu.edu  |  785-532-1162  |  K-State Research and Extension

For more information: Glynn Tonsor  |  gtonsor@ksu.edu  |  785-532-1518

Glynn Tonsor breaks down record high meat prices

If you’re cooking out this Memorial Weekend, plan on spending some extra money for your food, says a Kansas State University agricultural economist.

Glynn Tonsor, associate professor, says beef and pork prices are at an all-time high. Beef, which costs about $5.50 a pound, is 13 percent more compared to last year. Bacon and pork chops have increased by 15 percent.

Tonsor says several factors are contributing to the increased prices, such as the drought, the historically low number of cattle and recent animal health diseases.

“There are new animal health concerns in 2014,” Tonsor said. “We simply are producing less pork and that’s showing up as less pork on the retail shelf. Couple that with strong demand, and we have notably higher pork prices.”

Prices are steadily increasing in 2014. Meat prices in April were 3 percent higher than in March. Tonsor believes they will continue to increase for the rest of the year.

But despite the higher prices, consumers are still snatching burgers and bacon off the shelves.

“The public is willing to pay higher prices,” Tonsor said. “They value the convenience, the freshness, the qualities that are in these meat products.”

It could be awhile before beef prices come down.

“We have ongoing concerns with the drought and then a long biological lag for cattle,” Tonsor said. “Even though we’re trying to expand production, it takes multiple years. It’s probably going to be 2016 before we see more pounds on the shelf in the beef complex.”

Tonsor suggests comparing prices of meat products and consider buying alternate products, like bone-in instead of boneless, to save some money.

Written by Lindsey Elliott, K-State Communications and Marketing

Agricultural Economics student receives Stanley L. Winter Alpha Tau Omega K-State Student Union Leadership Scholarship

May 21, 2014 — The K-State Student Union presented the Stanley L. Winter Alpha Tau Omega K-State Student Union Leadership Scholarship at its annual leadership banquet May 3. Grant Hill, senior in management, Whitewater; Nate Spriggs, senior in agricultural economics, Riverton; and Ross Jensby, senior in mass communications, Beloit; were the 2014 recipients.

Stanley L. Winter was a 1986 K-State graduate who died of cancer in February 1992 at the age of 27. The scholarship perpetuates Winter’s memory by providing educational opportunities and assistance for students who possess exemplary attributes in scholarship, fellowship and character. For more information about the Union, visit union.k-state.edu or call the Union director’s office at 785-532-659

For more information about this award, visit the K-State Today news page.

Written by Arthur White | unionpr@k-state.edu

Agricultural Economics doctoral student selected to attend Lindau Nobel Laureates meeting

May 22, 2014 — Two Kansas State University doctoral students will visit with the world’s best economists at the fifth Lindau Meeting of the Laureates of the Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel, Aug. 19-24, in Lindau, Germany.

Melissa LynesMelissa Lynes, doctoral student in agricultural economics, Manhattan, and Hedieh Shadmani, doctoral student in economics, Iran, have been invited to attend the Lindau Meeting, which is an open exchange of economic expertise and to inspire cross-cultural and intergenerational encounters among economists worldwide.

“Melissa and Hedieh will have the opportunity to attend lectures, discussions, master classes and panel discussions with nearly 20 Nobel laureates,” said Carol Shanklin, dean of the university’s Graduate School. “The unique atmosphere of the Lindau meeting is an exceptional opportunity to enrich their education and make connections with economists around the world. This professional development opportunity will be one of the highlights of these graduate students’ academic experiences.”

One of the laureates attending will be John Nash Jr., the mathematician who was the inspiration for the movie “A Beautiful Mind.”

Lynes was selected as one of approximately 30 students in the U.S. delegation and is sponsored by Mars Inc. She will receive funding for travel and the cost of the meeting’s registration.

Lynes is investigating renewable energy policies, such as the Renewable Portfolio Standard, to determine if policies increase the price of electricity and if utility companies are operating efficiently. Her research provides information to policymakers to determine the feasibility of enacted or proposed policies, if the desired result is obtainable and if there are negative outcomes. Her advisers are Jeff Williams, professor of agricultural economics, and Jason Bergtold, associate professor of agricultural economics.

“Melissa Lynes is an excellent and enthusiastic researcher,” Williams said. “She will be fully engaged in discussions with the Nobel laureates at the conference and apply what she learns from them to her research work at Kansas State University.”

Lynes has published “Kansas Farmers’ Characteristics and Willingness to grow Cellulosic Bioenergy Crops” in the Journal of American Society of Farm Managers and Rural Appraisers. In addition, she has presented at the International Oil Spill Conference 2014 in Savannah, Georgia; the 32nd annual United States Association of Energy Economics in 2013 at Anchorage, Alaska, and the Agricultural and Applied Economics Association in at Seattle, Washington. Lynes is a National Needs Fellow and the president of Kansas State University’s Graduate Students in Agricultural Economics. She received a bachelor’s degree from High Point University in High Point, North Carolina, and a master’s degree from Kansas State University.

For more information about this honor, visit the K-State Today news page.

Written by: Stephanie Jacques
785-532-3452
sjacques@k-state.edu

 

Kansas State University Celebrates a Century of Extension Making a Difference

Recognizing the 100th anniversary of the signing of the Smith-Lever Act, the founding legislation of the nationwide Cooperative Extension System

May 6, 2014 – Most Kansans may not realize the significance of a congressional act signed 100 years ago.

In 1914, U.S. Senator Hoke Smith of Georgia and U.S. Representative A. F. Lever of South Carolina authored the Smith-Lever Act to expand the “vocational, agricultural and home demonstration programs in rural America.” The act assured delivery of research-based knowledge of the land-grant universities to people where they live and work. Extension 100 banner

This mission enables Kansas State University through its K-State Research and Extension program to enrich the lives of Kansans. Extension focuses its work on finding solutions for topics important to Kansans, using its statewide network to share information.

Nationally, celebrations for the 100th anniversary of the Cooperative Extension System are taking place May 8, 2014.

“As a system, K-State Research and Extension works with Kansas farmers and ranchers to improve practices, establishing Kansas as the breadbasket of the world,” said John Floros, director of K-State Research and Extension and dean of the College of Agriculture. “Our families programs help people lead productive lives, while 4-H programs lead youth into adulthood.”

“Our citizens have told us there are five grand challenges facing Kansas. We built our strategic plan around finding solutions to these challenges, Floros said.

Grand Challenges Facing Kansas.

Kansas extension programs and efforts are focused on these five areas, Floros said.

  • Global Food Systems: With a goal of feeding the world’s growing population, work focuses on improved food and agricultural systems.
  • Water: With an eye on the future, efforts look at decreasing water needs or costs for livestock, crop production and municipal water systems.
  • Health: Quality of life, healthy development and behaviors for all life stages to reduce health problems and associated costs are the focus of programs.
  • Developing Tomorrow’s Leaders: Kansas looks to emerging leaders to lead the state forward. 4-H youth are learning leadership skills. Other efforts assist Kansas’s community leaders with economic development issues.
  • Community Vitality: Kansas’s rural, suburban and urban communities face many challenges. A variety of extension programs work to enrich Kansas communities.

Volunteers Critical to Program.

“We aren’t going to solve these challenges alone,” said Daryl Buchholz, associate director for extension and applied research. We work with agencies, organizations, business, industry, thousands of volunteers, and Kansas’s citizens. Through these efforts, we develop and share research-based knowledge for lifelong pursuits.”

Locally elected boards and program development committees work with local extension agents and specialists to determine programs to address critical needs of their community. Serving on these committees provides local citizens with an opportunity to help their communities.

“This is a hallmark of Kansas extension programs,” said Chuck Otte, Geary County extension agent. “Our local citizens work with agents to develop local extension programs with planned events, activities and strategies. All are focused on a common outcome for their communities. And it is backed by science-based education.”


State, University Recognize K-State Research and Extension

Proclamations signed in honor of 100th anniversary

It’s a salute to the faculty, staff and volunteers who have contributed careers, passions and their time to a common belief of a better future for Kansas.

In that recognition, Kansas Gov. Sam Brownback recognized the 100th anniversary of Cooperative Extension and the signing of the Smith-Lever Act.

The proclamation honors cooperative extension, which engages with rural and urban learners through practical community-based and online approaches. This results in “knowledge, skills and motivation to address the grand challenges facing Kansans in global food systems, water, health, vitalizing communities and developing tomorrow’s leaders.”

“I encourage the people of Kansas and the United States to observe and celebrate the centennial with a focus on launching an innovative and sustainable future for Cooperative Extension,” the governor’s proclamation stated. It was signed at the state capitol on May 1.

On Thursday, May 8, Kansas State University Provost April Mason will sign a proclamation recognizing cooperative extension as a crucial component of the land-grant mission.

Extension works collaboratively with research, particularly the Agricultural Experiment Station system and with academic programs in the system. There are 106 land-grant colleges and universities serving all 50 states, the District of Columbia and six U.S. territories.


Background Information

K-State Research and Extension
K-State Research and Extension is a short name for the Kansas Agricultural Experiment Station and Cooperative Extension Service.Extension 100

K-State Research and Extension is a partnership between Kansas State University and federal, state, and county government, with offices in every Kansas county. Research is conducted throughout Kansas and shared by extension agents and others.

K-State Research and Extension Mission
“We are dedicated to a safe, sustainable, competitive food and fiber system and to strong, healthy communities, families and youth through integrated research, analysis and education.”

More information on K-State Research and Extension programs and services is available at your local office or online (www.ksre.ksu.edu).

 


 

Story by: Elaine Edwards
elainee@ksu.edu
K-State Research & Extension News

The link for graphics is https://www.flickr.com/photos/ksrecomm/sets/72157644133572969

Spring 2014 E-Newsletter of the Department of Agricultural Economics

Dear Friends and Family of the Department of Agricultural Economics,

Greetings!  I hope this e-newsletter finds you in a prosperous spring. We are excited to send you this quarterly e-newsletter to provide you updates of the latest from the K-State Department of Agricultural Economics. You can access it online in various formats from our website at http://ageconomics.k-state.edu/p.aspx?tabid=708.

With this e-newsletter, we will keep you up-to-date on what we are doing and how you can stay active in our Department. Our goal is to keep you connected as a part of the K-State Agricultural Economics family.

Go Cats!

Dr. Allen M. Featherstone
Interim Department Head, Professor and Director of the Master of Agribusiness Program
Department of Agricultural Economics

Spring 2014 Contents:
Greetings and update from Allen Featherstone
Reagan Kays is elected K-State Student Body President: 17th from Agricultural Economics
Herrington and Parman earn Department honors
Spriggs earns award from Alumni Association
Students earn honorary spots for 2014-2015
Department represented by seven students in the College of Agriculture Ambassadors
Harlan and Hopper earn University promotions
Jackie McClaskey earns honor of College of Agriculture Outstanding Young Alumni
Cristina Mansfield honored as K-State Alumni Fellow
Agricultural Economics alumni earn Kansas Master Farmers and Master Farm Homemakers honors
Upcoming events
Congratulations to newly-elected student officers
Gifting opportunities with Agricultural Economics
Let’s get social!

If you did not receive the e-newsletter via email and wish to receive it in the future, please contact Amanda Erichsen at aerichsen@k-state.edu.