Agribusiness
GrowingOn® 2013 Meetings to Help Producers Make Better Business Decisions in 2013. PDF Print E-mail
News Releases - Agribusiness
Written by Lisa Yager   
Monday, 17 December 2012 14:51
OMAHA, Nebraska - (December 14, 2012) - Farm Credit Services of America (FCSAmerica) is hosting 17 GrowingOn meetings in January.  The purpose is to share information and insights to help producers plan and reduce risk in 2013.

The program will be presented by Steven Johnson, farm management specialist with Iowa State University Extension and Outreach. He will review 2013 planted acres, price and expense outlooks, which will be affected by more than supply and demand fundamentals.

"Even though many producers had disappointing yields because of the drought, we're still experiencing the best of times in row crop farming," said Johnson. "Demand remains strong; and with limited supplies, crop prices will be high in 2013. How high prices rise will largely be influenced by weather in addition to the U.S., Europe and China economies. Input costs for 2013 will be up slightly. Some input cost increases may affect margins for 2013 and 2014. And with the proposed new farm program, crop insurance decisions will be more important than ever."

"Crop insurance ensured many producers will be back in the field next year," said Christa Wilson, vice president-insurance for Farm Credit Services of America in Iowa. "Some producers also learned a painful lesson about crop insurance in 2012. Some didn't know what kind of coverage they had until they had to use their policy. Luckily, 90% of the corn acres in Iowa, Nebraska and South Dakota were insured at 70% yield levels or greater." At GrowingOn, FCSAmerica crop insurance specialists will share the lessons learned in 2012 - what farmers should revisit in 2013 and what new changes will occur that will factor into producers' crop insurance decisions. "Along with product and coverage level decisions, careful consideration should be given to the agent a producer works with in 2013," Wilson advised. "As a financial institution that offers crop insurance, Farm Credit Services of America has an incentive to sell the right insurance coverage.  And since our crop insurance specialists are not commission-based, the options we present each of our customers are based on what's right for them and no one else."

This two and one-half hour program will be held in Newton, Marshalltown, Perry, Eddyville, Mount Pleasant, Davenport, Cedar Rapids, Manchester, Festina, Lenox, Harlan, Storm Lake, Webster City, Carroll, Cedar Falls and Mason City, IA and in Sioux City, NE. Specific time and location information can be found at cropinsurancespecialists.com, by calling the local FCSAmerica office or by calling 1-800-884-FARM. Pre-registration is required.

Farm Credit Services of America is proud to finance the growth of rural America, including the special needs of young and beginning producers. With assets of more than $18 billion, FCSAmerica is one of the region's leading providers of credit and insurance services to farmers, ranchers, agribusiness and rural residents in Iowa, Nebraska, South Dakota and Wyoming. Learn more at fcsamerica.com.

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Farmland Value Reaches Historic $8,296 Statewide Average PDF Print E-mail
News Releases - Agribusiness
Written by Amanda Heitz   
Monday, 17 December 2012 14:34
AMES, Iowa — Average Iowa farmland value is estimated to be $8,296 per acre, an increase of 23.7 percent from 2011, according to results of the Iowa Land Value Survey conducted in November. This is the third year in a row where values have increased more than 15 percent. The 2012 values are historical peaks.

The increase is somewhat higher than results of other recent surveys of Iowa farmland value: the Chicago Federal Reserve Bank estimated an 18 percent increase in Iowa land values from October 2011 to October 2012 and the Iowa Chapter of the Realtors Land Institute estimated a 7.7 percent increase from March to September 2012.

“The difference in survey estimates could be due to values increasing more rapidly in the past few months than earlier in the year. Better than expected crop yields and the level of land sale activity due to the proposed changes in land related taxes contributed to the increasing values,” said Mike Duffy, Iowa State University economics professor and extension farm management economist who conducts the survey. “The Iowa State survey samples different populations, and uses different wording than the other surveys. This could also lead to different results especially in times of uncertainty. Even within the Iowa State survey there was considerable variation in the estimates.”

O’Brien County had an estimated $12,862 average value, the highest average county value. O’Brien County also had the highest percentage increase and highest dollar increase in value, 35.2 percent and $3,348, respectively. Osceola, Dickinson and Lyon counties also saw 35.2 percent increases. The Northwest Crop Reporting District, which includes all four counties, reported the highest land values at $12,890, an increase of $3,241 (33.6 percent) from 2011. “The 2012 land value survey covers one of the most remarkable years in Iowa land value history,” said Duffy. “This is the highest state value recorded by the survey, and the first time county averages have reached levels over $10,000. While this is an interesting time, there is considerable uncertainty surrounding future land values.”

Why Iowa farmland values are increasing

Duffy said understanding some of the causes for the current increase in farmland values is helpful in assessing the situation. Farmland values are highly correlated with farm income. As farm income increases, so will land values. In 2005, corn prices averaged $1.94 per bushel in Iowa. The preliminary estimated price for November 2012 is $6.80. Soybean prices changed from $5.54 to $13.70 over the same period. Coming into 2012 there was a general sentiment that prices would decline from their peaks. But, the drought changed this and the prices remained at high levels. How long the high prices will last is unknown.

There has been considerable variation in commodity prices over the past few years, but farm income has increased substantially. The Iowa State economist goes on to say, the increase in income has been the primary cause for the increase in farmland values, but not the only one. “There are other causes for the increase,” Duffy said. “Interest rates are at the lowest level in recent memory. Farmland purchased by investors went from 18 percent in 1989 to 39 percent of purchases in 2005, but investor purchases are back to the 1989 level of 18 percent this year after decreasing for the third year in a row.”

Another key component is the costs of production. In the past, costs have risen in response to higher commodity prices. This is especially true for rents. Iowa State University estimated costs of crop production have shown a 61 percent increase in the cost per bushel since 2005. Without land, the increase has been 87 percent.

Duffy believes there is still discipline in the land market, while land values have increased 64 percent in the past three years, in 2009 values did decrease by 2.2 percent. Therefore, it is prudent to be mindful of the factors that influence land values. The economist said there are several key components to watch:
  • Weather related problems – both here and around the world
  • Government policies – especially policies related to estate and capital gains tax rates
  • The amount of debt incurred with land acquisition
  • What happens to input costs – land being the residual claimant to any excess profits in agriculture
  • Government monetary policies as they relate to inflation and interest rates
  • The performance of the U.S. economy and economies throughout the world – which impact commodity prices, which in turn impact land values
Overview of 2012 Iowa land values

While the highest county land values were reported in O’Brien County, Decatur County remained the lowest reported land value, $3,242 per acre, and the lowest dollar increase, $521.

Keokuk and Washington Counties had the lowest percentage increase, 14.8 percent, with reported average values of $6,330 and $8,226, respectively.

Low grade land in the state averaged $5,119 per acre and showed a 20.2 percent increase or $862 per acre, while medium grade land averaged $7,773 per acre; high grade land averaged $10,181 per acre. The lowest land value was estimated in the South Central Crop Reporting District, $4,308, while the lowest percentage increase was in the Southeast Crop Reporting District with an 8.2 percent increase. The Northwest Crop Reporting District reported a 36.8 percent increase, the highest district average percentage reported. Maps showing 2012 values, percentage change and comparisons to 2011 data and additional information from Duffy are available at www.extension.iastate.edu/topic/landvalue.

The Iowa Land Value Survey was initiated in 1941 and is sponsored by the Iowa Agriculture and Home Economics Experiment Station, Iowa State University. Only the state average and the district averages are based directly on the Iowa State survey data. The county estimates are derived using a procedure that combines survey results with data from the U.S. Census of Agriculture.

The survey is based on reports by licensed real estate brokers and selected individuals considered knowledgeable of land market conditions. The 2012 survey is based on 486 usable responses providing 663 county land value estimates. The survey is intended to provide information on general land value trends, geographical land price relationships and factors influencing the Iowa land market. It is not intended to provide an estimate for any particular piece of property.

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Plan Now to Attend Driftless Region Beef Conference PDF Print E-mail
News Releases - Agribusiness
Written by Amanda Heitz   
Monday, 17 December 2012 14:24
With nearly 2.5 million cattle in the four-state Driftless Region, extension services in Illinois, Iowa, Minnesota and Wisconsin have teamed up to offer a Driftless Region Beef Conference. The first event will be held on Jan. 31 and Feb. 1, 2013, at the Grand River Convention Center in Dubuque, Iowa.

The Driftless Region includes beautiful rolling hills, clean streams and karst soil topography. Conservation of our soils and protection of our waters are best accomplished with much of the land seeded to forage production. That requires cattle to consume these forages. The Driftless Beef Conference will focus on efficient and economic beef and forage production.

The program will begin at 1 p.m. on Jan. 31 and run till 11:45 a.m.on Feb. 1. Some of the key speakers include Dan Shike and Tara Felix, University of Illinois; Matt Spangler, University of Nebraska-Lincoln; Amy Radunz, University of Wisconsin - River Falls; and Darrell Peel, Oklahoma State University. Thursday’s afternoon program will focus on feed efficiency at all stages of production, with an evening discussion focused on straight versus crossbreeding. Friday morning’s program includes three breakout sessions for feedlot operations and three for cow herds.

Registration for the conference is $80 before Jan. 15 or $100 after Jan. 15. Additional information about the conference is available at www.aep.iastate.edu/beef. Registration will open for the conference on Dec. 1.

The Driftless Region Beef Conference is sponsored by the University of Illinois Extension, Iowa State University Extension and Outreach, the University of Minnesota Extension, and University of Wisconsin Extension. The planning team strives to deliver the latest in research-based information regarding the beef cattle industry. For more information or to receive a brochure, contact Denise Schwab at 319-721-9624.

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Loebsack to Tour Fairfield Middle School Farm to School Program PDF Print E-mail
News Releases - Agribusiness
Written by Joe Hand   
Monday, 10 December 2012 09:07

Washington, D.C. – Congressman Dave Loebsack today announced that he will tour Fairfield Middle School and learn about their Farm to School program on MONDAY, December 10th at 1:00pm. Recently, the Hometown Harvest of Southeast Iowa in Fairfield and Pathfinders Resource Conservation & Development, Inc. received a $100,000 grant from the USDA to provide the school with fresh produce as well as educate students on the importance of locally grown food.  Loebsack will meet with students, teachers and staff from Hometown Harvest and Pathfinders.  Media are invited to attend.

Tour Fairfield Middle School

404 West Filmore Avenue

1:00pm

 
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