Travis Carlstrom

Between the 24/7 demands of running an agricultural operation and the blinding pace of our world today, there is little time to sift through all the headlines. The good news is that you no longer have to! Our goal is to point you to some of the most important headlines in agriculture, so you can stay informed on the forces shaping your livelihoods. To save you time, here are the week's top links and news items: Top news 1. From FBN: 4 Financial Priorities for Farmers in March This link highlights the financial priorities to consider keeping top of mind this month. Watch for Interest Rate Changes Following the March Fed Meeting Conduct Equipment Maintenance Before Planting Begins Finalize Your Insurance Coverage Assess the Future Value of Your Farmland 2. What Does the Failure of Silicon Valley Bank Mean to Ag Markets? FDIC records show SVB's failure is the second largest in US history. Companies at risk of losing money in a scenario of higher interest rates and lower returns typically carry high debt loads and earn a low return on assets. The primary concern for the ag markets is that this is the type of event that causes traders to trim their long positions. Corn, soybeans and cattle have large net-long positions held by specs and look vulnerable. Corn prices look the most vulnerable as specs were already stressed by May prices that have fallen 60 cents in the past three weeks. 3. Growth in Farmland Values Slows Amid Higher Interest Rates Farm real estate values increased in 2022 but showed signs of softening during the final months of 2022 as interest rates rose sharply. The average rate charged on agricultural loans increased nearly 150 basis points from the previous quarter and were about 300 basis points higher than a year ago. Rates rose to the highest level since 2008 and pushed up financing costs considerably. Benchmark interest rates surpassed returns to farmland owners in recent months, which could put some downward pressure on growth in farmland values going forward. Capitalization rates, calculated as the ratio of cash rents to farmland values, have decreased continuously over the past 15 years. 4. Texas Supreme Court Rules in Favor of Ag Retailer in Drift Case This recent court case highlights the requirements of farmers attempting to prove financial damage from exposure to pesticides. Demonstrating visual damage is not sufficient in these cases.  Farmers must show what amount of the pesticide reached the crop and whether that amount would reduce crop yields. Expert testimony is required for corroboration, as the farmer's experience is not sufficient. Farmers must show reduced crop yields for the entire area for which he seeks damages. 5. For beef-on-dairy, Angus performs best Penn State is conducting a feedlot trial to determine optimal beef genetics of steers born to Holstein cows. Because the cattle that consumed less feed grew slower, no breed differences existed in feed conversion to gain. Angus-sired steers were heaviest at feedlot entry and were fed at the center for the fewest days. The Angus-Holstein steers reported the best profit/hd. Wagyu-Holstein steers had the worst profit/hd due to inferior average daily gain and dry matter intake, greater days on feed, and reduced carcass weights. Get in touch If you have any links you'd like to share or have any questions, please contact Travis Carlstrom, Sr. Ag Credit Analyst at FBN. © 2015-2023 Farmer’s Business Network, Inc. All rights reserved. The sprout logo, “Farmers Business Network,” and “FBN” are registered service marks of Farmer’s Business Network, Inc. or its affiliates and are used with permission. The material provided is for information purposes only. It is not intended to be a substitute for specific professional advice. Neither Farmer’s Business Network nor any of its affiliates makes any representations or warranties, express or implied, as to the accuracy or completeness of the statements or any information contained in the material and any liability therefore is expressly disclaimed. The information and opinions expressed by others in this material are their own and are not endorsed or approved by FBN or its affiliates. 

Between the 24/7 demands of running an agricultural operation and the blinding pace of our world today, there is little time to sift through all the headlines. The good news is that you no longer have to! Our goal is to point you to some of the most important headlines in agriculture, so you can stay informed on the forces shaping your livelihoods. To save you time, here are the week's top links and news items: Top news 1. From FBN®: Why Did National Farmland Values Increase in 2022? The FBN Data Science delivers data-driven insights on trends related to farmland values. The real mortgage rate is one of the best predictors of farmland value change. Since interest rates were low and inflation high for a big part of 2022, the real mortgage rate remained negative. On average, the farming sector is in an excellent financial position . The debt-to-asset ratio is low, indicating that farmers have used the high net income period to build equipment and financial reserves. 2. USDA Precision Technology Adoption Report Highlights and Analysis This link provides an excellent overview of the recent USDA report, Precision Agriculture in the Digital Era: Recent Adoption on U.S. Farms. Most forms of digital technology have been slowly adopted in the agricultural sector. However, biotechnology has moved at lightning speed in adoption terms . A Hierarchy of Farmer Technology Adoption is developed to show how successfully a technology will be adopted. Farmers slow to adopt technology are typically correlated with smaller farm sizes, lower crop yields, less use of  technical or consulting services 3. Grain Stocks Remain Tight A number of factors have elevated commodity prices in recent years, and this link looks at the tight grain stocks situation. Corn, soybean, and wheat stocks are all below the long-run average in the US . The situation is similar on a global scale.  Any production concerns in 2023 could trigger a dramatic price response. Accordingly, all crops will be bidding for acres going into 2023. 4. Early herd rebuilding could happen through the bred cow market The USDA Cattle Inventory report shows that feeder cattle supplies will be reduced nationally in 2023 . Expected profit margins in the current year will help determine how quickly the herd can be rebuilt. The quickest way for these producers to increase the feeder cattle supply is through the addition of bred cows or bred heifers. Higher feeder cattle prices create incentives for more calves to be brought to market and bred cows are the quickest way to do so. This link also provides a chart for premiums/discounts for bred cows based on expected feeder cattle and corn prices. 5. The Use of Climate Information in Midwest Agriculture: Results from a Farmer Survey This link examines how farmers utilize weather/climate information in their decision-making processes. Most farmers use the short-term forecast in farming decisions, especially when it comes to planting and spraying time, fertilizer application, and hay management. The use of longer-term forecasts are utilized less frequently. The most common use of long-term forecasts is for marketing strategy. 50% of farmers rely on their own experience when making decisions based on climate/weather forecasts.  The other half uses advice from the public sector (University extension) and/or the private sector (Ag inputs supplies, farm advisors, and neighbors). Get in touch If you have any links you'd like to share or have any questions, please contact Travis Carlstrom, Sr. Ag Credit Analyst at FBN. © 2015-2023 Farmer’s Business Network, Inc. All rights reserved. The sprout logo, “Farmers Business Network,” and “FBN” are registered service marks of Farmer’s Business Network, Inc. or its affiliates and are used with permission. The material provided is for information purposes only. It is not intended to be a substitute for specific professional advice. Neither Farmer’s Business Network nor any of its affiliates makes any representations or warranties, express or implied, as to the accuracy or completeness of the statements or any information contained in the material and any liability therefore is expressly disclaimed. The information and opinions expressed by others in this material are their own and are not endorsed or approved by FBN or its affiliates. 

Between the 24/7 demands of running an agricultural operation and the blinding pace of our world today, there is little time to sift through all the headlines. The good news is that you no longer have to! Our goal is to point you to some of the most important headlines in agriculture, so you can stay informed on the forces shaping your livelihoods. To save you time, here are the week's top links and news items: Top news 1. From FBN: Forecasting 2023 Farmland Values: Will U.S. Land Prices Decrease This Year? How will the increase in interest rates, inflation, and farm income affect land values going forward? FBN's data science team identified two main variables that correlate well with farmland values; when combined, the correlation is even stronger. Aggregate Farmer Savings captures the effect of farmers saving their income, and it has a lag effect. Last year this measure increased. The Real Mortgage Rate reflects borrowing incentive and alternative expected returns. This measure decreased in the last year. The changes in these two measures suggest that additional increases in farmland values can be expected. 2. Farm Debt Concentration and Repayment This link takes a look at which farms hold the majority of farm debt and their ability to repay that debt.  The three largest segments of farms account for 22% of all farms and 80% of farm debt. So, a small share of farm businesses hold a disproportionate share of the sector debt. The debt repayment capacity utilization ratio considers how much of a farm’s annual debt repayment capacity is being utilized. Despite accounting for the majority of sector debt and having higher payments, the repayment burden of larger farms is not as burdensome as it initially seems.  3. RP vs. RP-HPE Insurance Decision: Premium, Cash Flow, and Forward Contracting This link explores the decision between RP, crop revenue insurance, and RP-HPE, crop revenue insurance without the harvest price option (HPO) . RP-HPE has a lower premium and thus a lower cash outflow for premiums since it does not have HPO.  The premium subsidy however favors RP as does forward selling. This analysis suggests RP is a better insurance choice than RP-HPE for farmers who have sold or expect to sell before harvest more than 10% of corn and soybean production If forward selling is less than 10%, RP-HPE may be an option to consider.   The analysis completed prompts a policy question, “Would an insurance product specifically designed for forward selling risk be a better option than RP?”  4. Soybeans Not 'Bidding' for Acres Because They Don't Have To As planting season approaches, many farmers are paying attention to soybean-to-corn price ratio for an indication of which crop will produce higher levels of profitability. Based on expected crop insurance prices, the soybean-to-corn price ratio is historically low at only 2.31-to-1 , which suggests that soybeans are underpriced. However, a major reason for this is the relatively high price of fertilizer.  When fertilizer prices are relatively high, corn must bid aggressively in the "Battle of Acres." One potential reason the soybean-to-corn price ratio may be low in 2023 is that the soybean market can already feel assured of ample acreage. The key to the acreage battle will be the price of fertilizer.  The price of fertilizer can be volatile, especially with the current geopolitical situation. 5. Supreme Court May Soon Announce Prop 12 Decision; Here's Why All Producers Should Care The California law being challenged bans the sale of pork within the state unless pregnant pigs are allowed a specific amount of space. The measure was approved with more than 68% of the vote as part of a 2018 ballot initiative known as Proposition 12. Farm groups say the measure violates the "dormant commerce clause", a doctrine that says the U.S. Constitution limits the power of states to regulate commerce outside their borders. If the Court rules in favor of California, the legislation will open a door to a much larger arena of regulatory authority. If this happens, it would potentially allow each state to set its own standards on any and all products that come across state lines. Get in touch If you have any links you'd like to share or have any questions, please contact Travis Carlstrom, Sr. Ag Credit Analyst at FBN. © 2015-2023 Farmer’s Business Network, Inc. All rights reserved. The sprout logo, “Farmers Business Network,” and “FBN” are registered service marks of Farmer’s Business Network, Inc. or its affiliates and are used with permission. The material provided is for information purposes only. It is not intended to be a substitute for specific professional advice. Neither Farmer’s Business Network nor any of its affiliates makes any representations or warranties, express or implied, as to the accuracy or completeness of the statements or any information contained in the material and any liability therefore is expressly disclaimed. The information and opinions expressed by others in this material are their own and are not endorsed or approved by FBN or its affiliates. 

Between the 24/7 demands of running an agricultural operation and the blinding pace of our world today, there is little time to sift through all the headlines. The good news is that you no longer have to! Our goal is to point you to some of the most important headlines in agriculture, so you can stay informed on the forces shaping your livelihoods. To save you time, here are the week's top links and news items: Top news 1. From FBN®: Crop Insurance Outlook and Tools This webinar explores some of the key considerations when finalizing your crop insurance coverage for 2023 . SCO/ECO endorsements are discussed as options to increase your coverage level. FBN economist Kevin McNew discusses key market forces and drivers in the farm economy. Keep watching to find out how FBN's approach to crop insurance differs from many providers today. 2. Why Do I Need Working Capital? Having sufficient working capital allows a farming operation to adjust to events like drought, low commodity prices and opportunities to make large purchases. The "right" amount of working capital depends on the size, type, age and goals of your operation. This link looks at two different ways to measure working capital : Working capital to gross returns Working capital to operating expenses General benchmarks to shoot for according to this article are 30% for working capital to gross returns and 50% for working capital to operating expenses. A farm should measure their working capital at the same point every year. 3. Growth in Farmland Value Continues, but Higher Rates Temper the Outlook This link uses some great graphics to illustrate the current condition of the farm economy . Despite the rapid rise in rates, the value of farmland has continued to increase, but at a more tempered pace than earlier in the year. Interest rates on farm loans reached the highest levels since 2007, putting considerable upward pressure on financing costs for some producers. Cash rents also continued to increase and showed less pronounced signs of softening than farmland values. Farmers accounted for more than 75% of farmland purchases in 2022 , a slightly higher share than in 2021. 4. Corn Trend Yield Corn yields in the U.S. were flat for 70 years from 1866 into the 1930s. This was remarkable because crop breeding must run ever faster just to stay even because diseases and pests adapt. Science, rising input levels, and management improvements have allowed the U.S. to increase corn yields by about 2 bushels/year for over 60 years. A major question under debate is whether a third production boom started in the mid-1990's due to genetically modified traits. Some research suggests that recent corn yield gains were primarily due to better than average weather instead of a dramatic jump in the genetic yield potential of corn. 5. Beef Cow Herd to Shrink For Years to Come The key factors to watch for short-term supplies of beef are the number of cattle on feed, placements of cattle into feedlots, and marketings of cattle . The key factors for long-term supplies of beef are beef cow numbers, heifers for beef cow replacement, and the calf crop. The 2022 U.S. calf crop was 34.465 million head, down 2.0% from the 2021 calf crop.  Fewer calves means less beef is coming. Compounding this is the persistent drought in cattle producing areas which has impacted pasture conditions and hay production. Most analysts suggest that meaningful rebuilding of the cow herd may not materialize until 2025 . Get in touch If you have any links you'd like to share or have any questions, please contact Travis Carlstrom, Sr. Ag Credit Analyst at FBN. © 2015-2023 Farmer’s Business Network, Inc. All rights reserved. The sprout logo, “Farmers Business Network,” and “FBN” are registered service marks of Farmer’s Business Network, Inc. or its affiliates and are used with permission. The material provided is for information purposes only. It is not intended to be a substitute for specific professional advice. Neither Farmer’s Business Network nor any of its affiliates makes any representations or warranties, express or implied, as to the accuracy or completeness of the statements or any information contained in the material and any liability therefore is expressly disclaimed. The information and opinions expressed by others in this material are their own and are not endorsed or approved by FBN or its affiliates. 

Between the 24/7 demands of running an agricultural operation and the blinding pace of our world today, there is little time to sift through all the headlines. The good news is that you no longer have to! Our goal is to point you to some of the most important headlines in agriculture, so you can stay informed on the forces shaping your livelihoods. To save you time, here are the week's top links and news items: Top news 1. From FBN: Market Outlook Ahead of the 2023 Growing Season FBN® Chef Economist Kevin McNew gives a quick overview of what to expect for the 2023 crop year . Corn will have plenty of factors supporting price this year. Compared to last year, we do not have the headwinds due to the rising value of the U.S. dollar and the logistics problems on the Mississippi River. Adding to price support on corn is the weather-related concerns for the Argentinian and Brazilian corn crop. While fertilizer prices are expected to remain relatively high, U.S. corn growers have an advantage over other countries due to the abundant supply of natural gas. 2. For Love of Meat: Five Trends in China That Meat Executives Must Grasp More than half of Chinese consumers eat meat regularly . Pork dominates the meat menu in China, but rising income levels threaten pork’s market share. Chinese consumers look, first and foremost, for product safety and quality and taste as opposed to price being the dominant concern in the West. Growing demand for convenience is shaping new patterns of meat consumption in China. Consumer awareness of sustainability is increasing in China but does not translate into enthusiasm for alternative meat. 3. Farm Debt-to-Asset Ratio Trends In looking at one of the most watched financial metrics of the farm economy, debt levels are nowhere near the conditions of the 1980's . However, this does not tell the whole story of the financial health of U.S. farmers. This link shows that the larger the farm, the higher the debt-to-asset ratio we will generally expect to see. In looking at "highly leveraged" operations, there are more crop operations than livestock operations. With that said, there are fewer "highly leveraged" operations compared to the 1990's and early 2000's. 4. Agriculture’s Contributions to County Economic Activity This link uses a couple of great graphics to illustrate the importance of production agriculture contribution at the county level. Production agriculture accounted for $206 billion of the U.S. economy in 2021 . Non-metro counties generated only 10% of the total U.S. GDP, but contributed over half of GDP created from production agriculture. The importance of production agriculture is not consistent geographically. Many rural communities need more diverse economies to support production agriculture.  5. What Higher Interest Rates Mean for Ag Three Purdue University ag economists recently shared how agriculture will be impacted by rising interest rates. Increasing interest rates will put downward pressure on land prices . Rising interest rates means the value of the dollar will likely strengthen. The value of the dollar vs. other currencies might make U.S. ag assets like farmland even more attractive to foreign buyers. Higher degrees of uncertainty increase the importance of ensuring you have sufficient levels of liquidity to cover payments, living expenses, and equipment depreciation. Get in touch If you have any links you'd like to share or have any questions, please contact Travis Carlstrom, Sr. Ag Credit Analyst at FBN. © 2015-2023 Farmer’s Business Network, Inc. All rights reserved. The sprout logo, “Farmers Business Network,” and “FBN” are registered service marks of Farmer’s Business Network, Inc. or its affiliates and are used with permission. The material provided is for information purposes only. It is not intended to be a substitute for specific professional advice. Neither Farmer’s Business Network nor any of its affiliates makes any representations or warranties, express or implied, as to the accuracy or completeness of the statements or any information contained in the material and any liability therefore is expressly disclaimed. The information and opinions expressed by others in this material are their own and are not endorsed or approved by FBN or its affiliates. 

Between the 24/7 demands of running an agricultural operation and the blinding pace of our world today, there is little time to sift through all the headlines. The good news is that you no longer have to! Our goal is to point you to some of the most important headlines in agriculture, so you can stay informed on the forces shaping your livelihoods. To save you time, here are the week's top links and news items: Top news 1. From FBN : January Fed Meeting Recap: Where Are Interest Rates Headed This Year? Recent economic reports show strong job gains, low unemployment, and easing inflation .  Despite this, the Fed recently increased rates by 25 basis points, citing concerns that "expectations of higher inflation will become entrenched."  What does this mean to producers as plans are being made for the 2023 crop year? Most analysts agree that interest rates will continue to increase through mid-2023, with declines not coming until later in the year.  As a result, producers can likely expect higher interest costs for the majority of the 2023 crop year. 2. Farmland Becomes Flashpoint in U.S.- China Relations A planned $700-million corn mill near Grand Forks, ND has become a flashpoint for a larger discussion about U.S. - China relations .  The project has brought numerous objections to the surface including, espionage and pricing American farmers out of the land market .  Recent data shows that Chinese investors own more than 338,000 acres at the end of 2020. While this is not enough acres to threaten U.S. food security, a number of states are considering restrictions on foreign ownership of farmland.  See this recent report for more information . 3. Smallest Cattle Herd in Eight Years: Will 2023 Set Record Prices? The recent USDA cattle inventory report revealed the fourth consecutive year of contraction in the U.S. beef cow herd . Accordingly, beef production is predicted to be 6.5% lower than last year. The video in this link examines the possibility of record beef prices. How quickly the herd can be rebuilt will likely determine the price ceiling going forward. The rebuilding of the herd is generally predicted to be slower than 2014, due to "lack of potential replacement heifers, uncertainty about inflation and interest rates, and competition from pork, poultry, and imported beef." 4. Are Robots Going to Steal Our Jobs? One of the more heavily discussed topics in recent times is the use of AI in agriculture . Many are concerned over the impact on agricultural jobs. This link compares the current discussion of labor displacement to previous technological advancements in agriculture.  Also, many producers today report significant issues in maintaining a sufficient supply of agricultural workers. While technological advancement will have an impact on the agricultural labor market, AI will first fill a gap left due to current labor shortages. 5. Is $620 Per Acre Cash Rent an Anomaly or the New Norm? With strong commodity prices and limited supply of land to rent, the cash rent market is seeing significant increases . Iowa has been the leading state for land prices, but Illinois seems to be generating the highest cash rents as of late.  Historically, cash rents were negotiated privately. However, today many farmers are using technology to find farms to rent. Cash rent auctions and the increased use of technology are driving rents higher than in prior years. Get in touch If you have any links you'd like to share or have any questions, please contact Travis Carlstrom, Sr. Ag Credit Analyst at FBN. © 2015-2023 Farmer’s Business Network, Inc. All rights reserved. The sprout logo, “Farmers Business Network,” and “FBN” are registered service marks of Farmer’s Business Network, Inc. or its affiliates and are used with permission. The material provided is for information purposes only. It is not intended to be a substitute for specific professional advice. Neither Farmer’s Business Network nor any of its affiliates makes any representations or warranties, express or implied, as to the accuracy or completeness of the statements or any information contained in the material and any liability therefore is expressly disclaimed. The information and opinions expressed by others in this material are their own and are not endorsed or approved by FBN or its affiliates. 

Between the 24/7 demands of running an agricultural operation and the blinding pace of our world today, there is little time to sift through all the headlines. The good news is that you no longer have to! Our goal is to point you to some of the most important headlines in agriculture, so you can stay informed on the forces shaping your livelihoods. To save you time, here are the week's top links and news items: Top news 1. From FBN: How Do Interest Rates and Inflation Affect Farmland Values? The two biggest drivers of land values are farm profits and interest rates . Despite the rise of interest rates in 2022, there has been minimal impact on land values.  This indicates how profitable the last two crop years have been for farmers, but what does the future hold?  The current rate environment suggests that further land value increases are possible. This link also outlines four separate scenarios for land values going forward. 2. Why South America Drives Winter Oilseed Markets   Reports have surfaced that Brazil and Argentina are considering the creation of a single currency , which prompted the author of this link to ask questions about the shared economic power of the South American market.  This is relevant for the ag community as 54% of the world's annual soybean production comes from South America. This compares to 30% for the United States.  The follow up question examined is the link between the global vegetable oil market and crude prices.  The positive correlation suggests sustained support for soybean prices going forward. 3. Retailers moving upstream: Is vertical integration coming, or has it already arrived? Much ink has been spilled over the last few years regarding the Big Four packers holding 85% of the nation's beef supply .  This link uses Walmart as an example of how vertical integration might be one way to counter the influence of consolidation.  In recent years, Walmart has intentionally made efforts to secure its own beef supply by purchasing a minority stake in a packing plant in Nebraska, a boxed beef plant in Georgia and an agreement to supply fed calves for its branded beef program.  4. Farm CapEx Jumps Higher Capital expenditures (the purchase of farm equipment, vehicles, and buildings) will typically track with farm incomes.  With the rise in commodity prices in 2021 and 2022, we have seen a 33% increase in capital expenditures.  This link has a nice chart that breaks down the different categories of purchases.  This illustrates that tractors have accounted for a larger portion of purchases than in previous years. Overall, capital expenditures are less than the 2011-2013 timeframe.  5. The US Cowherd Now Has the Fewest Beef Cows Ever Everyone expected this week's Cattle Inventory report to show historically low numbers, but few expected the published result.  As of January 2023, we have the fewest beef cows ever recorded .  This link examines the short and long-term impacts of the report.  In the short-term, small supply will support prices.  Longer-term, this author is a bit more cautious.  Building the herd back to historical norms faces significant headwinds (higher interest rates, supply of pasture is down, inflation, and geopolitical events). Get in touch If you have any links you'd like to share or have any questions, please contact Travis Carlstrom, Sr. Ag Credit Analyst at FBN. © 2015-2023 Farmer’s Business Network, Inc. All rights reserved. The sprout logo, “Farmers Business Network,” and “FBN” are registered service marks of Farmer’s Business Network, Inc. or its affiliates and are used with permission. The material provided is for information purposes only. It is not intended to be a substitute for specific professional advice. Neither Farmer’s Business Network nor any of its affiliates makes any representations or warranties, express or implied, as to the accuracy or completeness of the statements or any information contained in the material and any liability therefore is expressly disclaimed. The information and opinions expressed by others in this material are their own and are not endorsed or approved by FBN or its affiliates. 

Between the 24/7 demands of running an agricultural operation and the blinding pace of our world today, there is little time to sift through all the headlines. The good news is that you no longer have to! Our goal is to point you to some of the most important headlines in agriculture, so you can stay informed on the forces shaping your livelihoods. To save you time, here are the week's top links and news items: Top news 1. How Pricey Are Cash Rents? Per acre rents are at all-time highs. However, there are other ways to consider overall land costs. This link takes a look at rents on a per-bushel basis and as a percentage of gross farm income.  Both measures suggest that overall cash rents are not at historical highs, due to productivity gains and strong commodity prices.  Does this mean that there are further increases in store for producers?  Watch for commodity prices to continue to be the strongest influence on the cash rent market. 2. Heifers on Feed Indicate Long-Term Liquidation Still Occuring The size of the beef herd decreased in 2022 due to drought conditions and strong demand for beef.  During periods of contraction producers sell more heifer calves. This increases the producer's income today, but contributes to further shrinking of the beef herd.  With fewer cows, we will have fewer feeder cattle, and lower total beef production. This is supportive to beef prices going forward.  This link combines the historical quarterly percentage of heifers on feed and cattle inventory report to show where herd numbers are heading.  3. Egg Prices Have Soared 60% in a Year. Here Is Why They Are So Expensive The single greatest factor contributing to higher egg prices is avian influenza. The current outbreak is the deadliest of all time, leading to egg inventories 29% lower than a year ago .  Despite increased biosecurity measures, avian flu has been difficult to prevent due to the wild birds that spread the virus as they migrate.  However, we can expect consumers to see high prices after the outbreak due to other contributing factors, such as inflation and higher input costs for producers. 4. New Year's Resolution: Good Grain Marketing Habits The last two years have rewarded producers who have waited to market their crop until the following year.  History suggests that this is not the best method to sell at market highs. In 7 out of the 10 previous crop years, the highest prices were found when selling in the spring or summer before harvest .  Selling a crop before the bushels are in the bin can be uncomfortable. However, history suggests that commodity prices typically hover close to the cost of production.  Accordingly, this link asks producers to consider whether it is more likely for prices to increase or decrease. 5. Chessboard of Producers This link utilizes a series of nice graphics to provide an overview of the cow/calf sector. As of the most recent Ag Census, there are approximately 729,000 operations running 31.7 million cows .  While the vast majority of operations manage fewer than 200 cows , the majority of cows are found in larger operations. Smaller operations also tend to have a much higher reliance on off-farm income and higher likelihood of exiting the business within the next five years. The data point to the conclusion that there is a wide disparity in the goals of cow/calf producers.  Because of this, industry leaders and legislators have a tremendous challenge in implementing policy to promote the cow/calf sector. Get in touch If you have any links you'd like to share or have any questions, please contact Travis Carlstrom, Sr. Ag Credit Analyst at FBN. © 2015-2023 Farmer’s Business Network, Inc. All rights reserved. The sprout logo, “Farmers Business Network,” and “FBN” are registered service marks of Farmer’s Business Network, Inc. or its affiliates and are used with permission. The material provided is for information purposes only. It is not intended to be a substitute for specific professional advice. Neither Farmer’s Business Network nor any of its affiliates makes any representations or warranties, express or implied, as to the accuracy or completeness of the statements or any information contained in the material and any liability therefore is expressly disclaimed. The information and opinions expressed by others in this material are their own and are not endorsed or approved by FBN or its affiliates. 

Between the 24/7 demands of running an agricultural operation and the blinding pace of our world today, there is little time to sift through all the headlines. The good news is that you no longer have to! Our goal is to point you to some of the most important headlines in agriculture, so you can stay informed on the forces shaping your livelihoods. To save you time, here are the week's top links and news items: Top news 1. Who's Really Behind All These Record Farmland Sales? and Grazing Land Values Keep Climbing Farmland recently sold in Sioux County, IA for $30,000/ac! While pasture/rangeland has not been quite as hot as cropland, values across all types of land have seen significant increases in 2022.  Prices have been driven by strong commodity prices and limited supply.  What is really interesting is that the vast majority of buyers are producers, not investors. While most analysts expect values to remain strong in 2023, there are reasons for caution. Keep an eye on rising interest rates and commodity prices going forward. 2. Crop Insurance Premium in 2023 It's time to start thinking about your risk management plan for the 2023 crop, and the backbone of any good plan is crop insurance. The University of Illinois has produced a Crop Insurance Decision Tool for the 2023 crop year.  The screenshots in the link highlight expectations for crop insurance prices in Illinois, but the tool does cover all of the major crop producing states.  Current expectations for a slight (less than 5%) increase in crop insurance premiums over 2022. However, much can change between now and March 15th. Go talk to your crop insurance agent! 3. 2023 Cattle Market Outlook High feed costs and the third straight year of drought conditions have resulted in relatively low cattle inventory numbers.  This link covers all the major factors influencing cattle prices (weather, production costs, demand, global trade, etc.) and includes some nice graphics.  The lower overall numbers would suggest that cattle prices will be strong in 2023.  4. Deere & Co. will allow farmers to repair their own equipment Up to this point, most major equipment manufacturers have required customers to use company service divisions for repairs.  A recently signed memorandum of understanding between Farm Bureau and John Deere has granted a significant win for the "right to repair" movement.  In a time when overall production costs are rising, this move has the potential to provide savings for many producers.  5. Global Farmer Insights Report, 2022 McKinsey & Co surveyed 5,500 farmers across the globe to determine the forces shaping the future of agriculture. The report has some very nice graphics and concludes that the top areas shaping the future are: 1. Willingness to Innovate 2. Digital Commerce Adoption 3. Growth in Digital Financing and Payments 4. AgTech Adoption 5. Adoption of Sustainability Practices Get in touch If you have any links you'd like to share or have any questions, please contact Travis Carlstrom, Sr. Ag Credit Analyst at FBN. © 2015-2023 Farmer’s Business Network, Inc. All rights reserved. The sprout logo, “Farmers Business Network,” and “FBN” are registered service marks of Farmer’s Business Network, Inc. or its affiliates and are used with permission. The material provided is for information purposes only. It is not intended to be a substitute for specific professional advice. Neither Farmer’s Business Network nor any of its affiliates makes any representations or warranties, express or implied, as to the accuracy or completeness of the statements or any information contained in the material and any liability therefore is expressly disclaimed. The information and opinions expressed by others in this material are their own and are not endorsed or approved by FBN or its affiliates.