Hurry up and wait (via The Progressive Farmer)

Every cook knows a watched pot won’t boil. Kenny Wells is starting to wonder if the same adage applies to herbicide-tolerant traits on the horizon.

The Missouri farmer needs another postemergence technology to help him manage herbicide-resistant waterhemp. Marestail (horseweed) and giant ragweed are the other major troublemakers on his Union Star, Mo., farm.

OPTIONS NEEDED

Wells tested Dow AgroSciences’ Enlist Weed Control System that utilizes a newly formulated version of 2,4-D in corn under permits in 2013. “I don’t know what we’re going to do if we don’t get this technology,” he said. “I’m using preemergence residual products and still getting escapes. I need more options.”

Farmers clamoring for new herbicide-tolerant technologies got a glimmer of hope in January 2014 when the U.S. Department of Agriculture’s (USDA) Animal and Plant Health Inspection Service (APHIS) released a 204-page draft Environmental Impact Statement (EIS) that indicated it will give a thumbs-up to deregulation of the Enlist trait for corn and soybeans. The technology must still go through a 45-day public comment period before a final draft is issued.

“We’re optimistic that corn and soybean growers will see Enlist technology commercialized for the 2015 season,” said Damon Palmer, U.S. commercial leader, Enlist Weed Control System. The cotton component is expected for the 2016 crop season.

CLOSER SCRUTINY

Monsanto’s new dicamba technology called Roundup Ready Xtend Crop System also became subject to an EIS scrutiny in 2013. Michelle Vigna, Roundup Ready Xtend launch manager for Monsanto, sees the completion of the draft EIS for Dow’s product as optimistic. “Monsanto is looking forward to the same milestone with regard to its review of dicamba-tolerant products in the coming months,” Vigna said.

“The regulatory processes remain on track for the 2015 introduction of Roundup Ready 2 Xtend soybean and Bollgard XtendFlex cotton,” she added. A dicamba-based corn product is moving through Monsanto’s pipeline but is several years behind the other traits.

USDA deregulation is only one piece of the puzzle. Monsanto and Dow must also pursue federal EPA approvals for use of the complementary herbicide products, as well as the federal and state registrations. Additionally, global import approvals are critical steps for product commercialization.

Doug Rushing, Industry Affairs director at Monsanto, remembers a more streamlined time. “It took 125 days to get Roundup Ready soybeans approved in 1995,” Rushing said. “With dicamba-tolerant soybeans, we’re sitting at over 1,300 days since we’ve made our submissions to USDA,” he said.

REGULATORY REVIEW

Dow first submitted its 2,4-D trait technology to USDA in 2009, Palmer noted. “USDA announced in May [2013] that it would do the EIS, and I’m pleased with how fast they turned that around considering the scope of the report,” he said.

Wells already knows 2,4-D well. He’s used it for years in combination with other herbicides as a spring burndown, but is anxious to have a system that avoids a waiting period prior to planting. “I’m looking forward to the timing advantages the tolerant crop offers. I didn’t have any trouble handling the product — volatility and drift concerns seem answered with the new formulation.”

Because of the experimental-use permit, the crop was destroyed prior to flowering, so Wells didn’t have a chance to weigh yield of the new traited hybrids.

“I’d like to have these new technologies to use while I can still use them proactively,” he said. “I’m afraid if they don’t come soon, we will totally lose the viability of glyphosate, and that will put more pressure on the other technologies,” he said.

Pam Smith can be reached at pamela.smith@dtn.com

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USDA Extends Enlist Comment Period

The United States Department of Agriculture’s (USDA) Animal and Plant Health Inspection Service (APHIS) has extended the comment period related to the Enlist Weed Control System until Tuesday, March 11, 2014.

The draft environmental impact statement (DEIS), currently under consideration, evaluates the potential environmental impacts of one corn and two soybean advanced technology varieties that are resistant to the herbicide known as 2,4-D, and several other herbicides.

Comments in support of the new weed control technology can be submitted by visiting www.advancefarming.com/petition.htm or via the USDA docket on http://www.regulations.gov.  Please reference docket number APHIS-2013-0042.

Rural lawmakers strugging to be heard (via St. Paul Pioneer Press)

They’re an endangered species in many state legislatures as more Americans move to urban centers or suburban cities: the rural lawmaker who knows what it’s like to care for a herd, plant a crop or drive on gravel roads.

Indiana Rep. Bill Friend, a pork producer, said it’s challenging to explain modern farming to colleagues who no longer have personal connections with agriculture. He calls it an annual educational project, as he knows of only one other state legislator who makes his living primarily from farming.

“They’re one, two, three generations removed from food production and agriculture. It’s kind of a foreign topic to them,” said Friend, the Republican majority floor leader in the Indiana House.

Lawmakers and political experts say the dwindling numbers of farmers, ranchers and others who make their living off the land affect not just agricultural policy but other rural concerns: highways, health care, schools and high-speed Internet access. Urban and suburban lawmakers might be sympathetic, but they’re often unfamiliar with particular concerns.

One Colorado legislator, a rancher, has even gone so far as to suggest each of his state’s 64 counties have a single House seat instead of awarding representation according to population.

In ag-centric Nebraska, more than half of the legislators now come from the Omaha and Lincoln areas. Similarly, South Dakota’s legislators are bunched near Sioux Falls or Rapid City — only 11 of South Dakota’s 105 legislators as of last year were involved in agribusiness; in 1987, the figure was nearly three times higher.

It was once the opposite.

Rural interests had outsized influence in state capitols back when districts often were based on geography rather than population, said Tim Storey, a senior fellow with the National Conference of State Legislatures. That changed when a series of U.S. Supreme Court decisions in the 1960s said legislative districts must have roughly equal populations to ensure the principle of one person, one vote.

“That just makes it more difficult for the rural voice to be heard. It doesn’t mean it can’t be heard. It’s just more challenging,” according to Doug Farquhar, the conference’s program director for agriculture and rural development.

Colorado state Rep. Jerry Sonnenberg’s radical idea of one representative per county comes out of his frustrations over not being heard — he is the only rural voice in the House. Currently, the state legislature’s votes are heavily concentrated in the greater Denver and Colorado Springs areas.

He concedes the idea is constitutionally dubious and follows a mostly symbolic ballot initiative in 11 rural Colorado counties last year to secede and form a 51st state amid disagreements over gun control, renewable energy mandates and other issues.

“I think it is an argument worth having,” said Sonnenberg, who represents a sprawling district in the northeastern plains. “But I have no illusions this would ever go into effect.”

In Minnesota, Rep. Rod Hamilton has long argued that rural concerns get neglected in St. Paul, where the number of farmers in the House stands at six — down from 14 as recently as 1995.

Hamilton, a Republican and pork producer, said he plans to work with other rural lawmakers from both parties in both chambers this session to protect shared interests against a leadership that’s mostly from the Twin Cities area.

“You don’t need that many votes to make an impact,” he said.

Illinois was the nation’s top soybean producer in 2013 and ranks No. 8 in the U.S. for number of farms, according to the U.S. Department of Agriculture’s Census of Agriculture report release this week. But Democrat John Sullivan is the only active farmer in the Illinois Senate, with 200 acres of grain and a few cows.

Sullivan, an assistant majority leader, lamented that the Senate agriculture committee’s chairman and other members don’t have agricultural backgrounds. He expects a struggle to make the farming opinion heard as the chairman pushes legislation to require labeling of foods that contain genetically engineered ingredients.

“It just makes it more difficult to explain and talk to my colleagues when they’re only hearing one side of it from opponents of GMO crops,” Sullivan said.

Forming partnerships has been key for the only full-time farmer in the Maryland Senate, Thomas McLain “Mac” Middleton.

Maryland has some of the country’s richest counties, but its poor, rural areas share many of the same problems as urban areas such as Baltimore — poverty, unemployment, teen pregnancies and lack of opportunities, Middleton said.

So he’s made common cause with his urban counterparts to ensure that rural communities have access to education funding as well as high-speed Internet service.

Though his 250-acre farm has been in his family since the 1600s and his ancestors grew tobacco, Middleton converted the property mostly to agritourism. He hosts school groups and families to visit barnyard animals, take hay rides, navigate a corn maze or pick strawberries and pumpkins.

Broadband has been important to the growth of his and many other businesses in rural Maryland.

He said: “I fight real hard to make sure that rural communities don’t get left behind.”

http://www.twincities.com/localnews/ci_25213337/rural-lawmakers-strugging-be-heard

Local dairy farmers waiting to see how margin insurance will affect them (via

Chuck Worden is an optimist about milk prices.

The Cassville dairy farmer said he hasn’t seen the price of milk dip dangerously low since 2009-10.

So, like other local farmers, he’s waiting to see what the new margin insurance outlined in the recently passed Farm Bill will mean for his dairy farm.

“I don’t know if I’d take advantage of it,” Worden said. “Unless the economists would see a benefit, I don’t know if I will.”

The Farm Bill is the primary agricultural and food policy tool of the federal government. The majority of the funding goes toward nutrition assistance programs, such as food stamps.

The margin insurance is covered by federal crop insurance, state Farm Bureau spokesman Steve Ammerman said, and differs from the previous Milk Income Loss Contract, or MILC, program that was used to compensate farmers when milk prices plummeted.

Margin insurance would be calculated by taking the difference between the milk price per 100 pounds and some index of farms’ feed costs. If that difference is $4 or less, the insurance would kick in.

Unlike the MILC program, Ammerman said the insurance program factors in the price of milk as well as feed.

“The margin insurance would kick in any time that gap shrinks below $4,” he said. “This is really in a dire situation. We think this will prevent those extreme drops, or at least provide a safety net.”

While prices haven’t dipped as low as $12 to $13 per 100 pounds like in 2009-10, Ammerman said dairy prices tend to be cyclical.

“Every three or four years, we can run into serious problems, and in fact milk prices in 2012 and in part of last year dipped again as well,” he said. “It didn’t dip into the dangerous levels as we saw in 2009, (but) the probability is certainly there.”

The passage of the Farm Bill also ensures that a price formula from 1949 would not take effect and drive up the cost of milk for consumers.

U.S. Rep. Richard Hanna, R-Barneveld, said the Farm Bill is not perfect but still a win for Upstate New York.

“This bill finally provides our agriculture businesses and rural communities with the support and certainty they deserve,” Hanna said in a news release.

Joseph Balagtas, associate professor of Agricultural Economics at Purdue University, said prices could dip low again but didn’t want to wager a guess on the likelihood.

“Those producers who sign up for (insurance), they will gauge the costs of signing up against the potential that margins fall,” he said.

The margin insurance would go into effect Sept. 1 if everything goes as planned, and farmers would pay a $100 annual fee. Ammerman said that for a wider gap than $4, farmers can purchase additional insurance.

Worden said he’s still unsure of what the insurance will really offer him until it goes into effect, and he is optimistic about the international demand for milk as well as the prices for it.

“I’m a believer that if there is a true demand worldwide, I don’t see a position in the U.S. where we’re going to drop down that low in the production,” he said.

Remsen dairy farmer Ben Simons also wants to see how the insurance will play out. He admitted that while factoring in the cost of feed is beneficial, it’s only a small piece of the pie.

“It’s only a small portion of the true cost of producing milk,” he said. “We have taxes, insurance, labor, electricity, fuel, energy. It’s just a small picture of what the true cost of producing milk is.”

Read more:”http://www.uticaod.com/article/20140217/News/140219281#ixzz2tnax77y0″>http://www.uticaod.com/article/20140217/News/140219281#ixzz2tnax77y0

Chipotle Unnecessarily Tears Down Agriculture to Build a Brand (via Truthabouttrade.org)

In the boardrooms of Madison Avenue, they call it “values branding”: a marketing strategy in which a company tries to instill a feeling of righteousness in the customers who buy its products.

But what kind of values would inspire a corporation to wage a smear campaign against America’s farmers?

That’s the question I asked after learning about the latest ploy of Chipotle Mexican Grill: a series of four 30-minute videos, scheduled to debut next week on Hulu, the online television service. Called “Farmed and Dangerous,” it is, in the words of the New York Times, “a full-throated attack on ‘industrial agriculture,’ complete with a Dr. Strangelove-like scientist inventing eight-winged chickens.”

Apparently the show also features exploding cows.

Maybe it’s funny, if you enjoy that sort of thing. Like a Super Bowl commercial with a laugh-out-loud gag, however, the point is not simply to earn a chuckle. Chipotle wants to boost its sales. “Farmed and Dangerous” is an expensive scheme to suggest that the act of buying burritos and tacos at Chipotle is morally superior to the act of buying them elsewhere.

As a business decision, it may make sense. But let’s not forget what this really is: propaganda. And it is intended to mock and discredit the honest work of farmers like me.

That’s rich, coming from a corporation that owns more than 1,500 restaurants and boasts a stock-market value of more than $15 billion. Its shares currently trade at about $550 apiece.

Chipotle was once a small fast-food restaurant chain in Colorado. Then, in the 1990s, McDonald’s became a major investor and Chipotle experienced super-sized growth. By the time McDonald’s sold its stake, Chipotle was a fast-food success story.

For the last few years, Chipotle has tried to brand itself as a source of “natural” and “sustainable” food. Steve Ells, its CEO, recently wrote about Chipotle’s “commitment to remove GMOs from our food to the fullest extent possible.” He added that “there is an active debate” over the safety of foods with GMO ingredients.

That’s true, in the sense that there was once an “active debate” over whether the earth is round or flat. Every responsible organization that has studied the safety of GMOs has come down squarely on their side, from the American Medical Association to the World Health Organization. The only people who dispute these findings are modern-day flat-earthers.

Not only are GMOs a proven source of good nutrition, they’re also good for the environment. They help farmers conserve soil and let us grow more food on less land. Mainstream foods with GMO ingredients can and do exist side-by-side with organic foods and other options. That’s what happens on my farm in California, where I raise GMO cotton alongside organic onions.

As a practical matter, Chipotle is going to have a tough time keeping its food-sourcing promises. I once did business with a major retailer that considered moving its entire line of t-shirts and underwear to all-organic cotton. It quickly became obvious that there wasn’t enough organic cotton in the world to meet this demand. Organic crops are niche products, hard to grow and expensive to sell.

The same rules apply to Chipotle. The fast-food chain is almost certain to hike its prices this year, according to accounts in the business media. Perhaps consumers are willing to open their wallets. And who am I to say they shouldn’t? Choices are good, and Chipotle is free to try to persuade people to pay a premium for their food.

Yet Chipotle’s customers should think twice about their options. Last year, the progressive magazine Mother Jones took a close look at the corporation’s claims and offered this advice: “If … you want to eat organic, avoid GMOs, and get food that’s locally sourced—your best bet is to go to a grocery store.”

As a farmer, I welcome an open dialogue and discussion about how I grow the food my family and yours eats. It’s a great story and I’m very proud of what I do.  Sarcasm, however, is not a productive route to building that type of conversation.

“Farmed and Dangerous” shows that Chipotle is not content to promote a positive image of itself, or to achieve a peaceful coexistence with American farmers who participate in modern agriculture. Instead, it wants to build itself up by tearing others down, rejecting the famous observation of Irwin Himmel: “No one has ever made himself great by showing how small someone else is.”

Ted Sheely raises lettuce, cotton, tomatoes, onions, wheat, pistachios, wine grapes and garlic on a family farm in the California San Joaquin Valley.  He volunteers as a board member of Truth About Trade and Technology (www.truthabouttrade.org). 

The plot to make Big Food pay (via Politico)

Lawyers are pitching state attorneys general in 16 states with a radical idea: make the food industry pay for soaring obesity-related health care costs.

It’s a move straight from the playbook of the Big Tobacco takedown of the 1990s, which ended in a $246 billion settlement with 46 states, a ban on cigarette marketing to young people and the Food and Drug Administration stepping in to regulate.

There are plenty of naysayers, just as there were in 1994 when Mike Moore, Mississippi’s attorney general, famously suggested suing the tobacco industry. But a number of nutrition and legal experts think a similar strategy could be applied on the food front — especially as obesity-related diseases have surpassed smoking as a major driver of health care costs.

“I believe that this is the most promising strategy to lighten the economic burden of obesity on states and taxpayers and to negotiate broader public health policy objectives,” Paul McDonald, a partner at Valorem Law Group in Chicago, said, leading the charge.

McDonald’s firm has sent proposals to AGs from California to Mississippi explaining how suing “big food” could help their states close budget gaps as billions in Medicaid expenditures eat a growing share of tax revenues.

In a letter to Pennsylvania Attorney General Kathleen Kane last year, McDonald noted that the state faced a $3.7 billion budget shortfall in 2012 and had to cut back on certain services. The state’s total Medicaid burden that year was $10 billion — and getting a piece of that back could help close the gap.

Similar proposals, tailored to each budgetary situation, also have been sent to AGs in Connecticut, Delaware, Iowa, Kentucky, Maryland, Massachusetts, Minnesota, New Jersey, New Mexico, New York, Nevada, North Carolina and Oregon, McDonald told POLITICO in an exclusive interview. So far none have agreed to sign on.

The central argument is that food and beverage companies have, to some extent, contributed to the nation’s obesity crisis, and they should pay for the costs of that portion.

The food industry, for its part, thinks the whole idea misses the mark.

“Regulation through litigation is not an effective or appropriate mechanism for policymaking,” said Ginny Smith Clemenko, senior director of communications at the Grocery Manufacturers Association, the food industry’s most influential lobbying group. “Proponents of bans, taxes and lawsuits as a means to curb obesity don’t truly understand the nature of the problem and lack the collaborative vision shared by first lady Michelle Obama and the vast majority of stakeholders who are working passionately to solve it.”

Food and beverage companies have, over the past decade, introduced 20,000 healthier products, voluntarily removed full-calorie drinks from schools and adopted self-regulatory standards for marketing to kids, Smith Clemenko adds.

The attorney looking to organize an attack against the food industry is an unlikely crusader. McDonald has represented both the tobacco industry when the feds went after it for racketeering and fraud and the food industry as senior counsel at Kraft Foods. He is quick to note he does not think food executives are “evil” or that the industry is full of “horrible people,” but he believes some of their practices have had consequences.

“It’s not a matter of casting the food industry as villains,” McDonald said. “There’s a cost of what they’re doing that they’re not internalizing, and the taxpayers are paying for it. The states don’t have many choices.”

McDonald’s law firm has allied with a number of well-known obesity and diabetes researchers, including Barry Popkin at the University of North Carolina Chapel Hill, Robert Lustig at the University of California San Francisco and economist Frank Chaloupka at the University of Illinois at Chicago, to help hash out the strategy.

Lustig, a pediatric endocrinologist, is known for his lecture “Sugar: The Bitter Truth,” which went viral, attracting more than 4 million views. He believes litigation should zero in on diabetes. “It’s the diseases related to obesity that are expensive,” he said.

More research is linking added sugars not only to diabetes but also to cardiovascular disease. According to one study, about 75 percent of all the packaged foods in U.S. supermarkets contains added sugars — from pasta sauce to Wheat Thins.

“We need policy to change,” said Lustig, who recently got a law degree and launched a nonprofit to continue his advocacy. “I think we’re going to have to battle [the food industry] like we battled tobacco.”

There are a number of obesity policy experts who don’t think what McDonald and his allies are attempting is such a crazy idea.

“I don’t think it’s far-fetched at all,” said Kelly Brownell, dean of Duke University’s Sanford School of Public Policy and one of the most-recognized obesity and nutrition policy experts. “I think it’s quite likely to occur,” said Brownell, though he is not involved in the effort. “It’s probably not something that will happen immediately, but I don’t think it’s that far off.”

But there are some in the legal realm who are more than skeptical.

James Tierney, director of the National State Attorneys General Program at Columbia Law School and former attorney general of Maine, laughed when asked about the proposal.

It’s just not going to happen,” said Tierney, who noted that tobacco companies lied about the health effects of their products for decades. “The food industry doesn’t deny that eating lots of food causes obesity.”

Whether such a lawsuit could ever survive in court, let alone result in a settlement or policy changes, is an open question, but food industry lawyers are already talking about, if not begrudgingly expecting future attempts aimed at the industry’s potential role in driving up health costs.

Bruce Silverglade, a principal at Olsson Frank Weeda Terman Matz, warned food industry attorneys two weeks ago about the litigation they should expect in the future. Food companies are already facing between 150 and 200 lawsuits centered on labeling and marketing disputes, many of them over use of the term “all natural.”

But the next waves of litigation are likely to be much different, Silverglade said at the meeting in San Francisco. He predicted lawyers will eventually home in on “food addiction,” a legal theory pioneered by former FDA Commissioner David Kessler.

“If certain fats, sugars, and salt were ‘addictive,’ and companies nonetheless proceeded to market products containing those nutrients … the consumer class action bar could attempt discovery in hoping to find company documents that validate Kessler’s addiction theory,” Silverglade noted in his presentation.

In other words, lawyers could go fishing in the hopes of finding some kind of “smoking gun.”

“Food and tobacco are different,” Silverglade said in an interview. “It’s a leap to think state AGs and class action lawyers could get to that point.”

McDonald’s pitch has also caught they eye of the Chamber of Commerce. The letter sent to Pennsylvania was cited in a recent report on emerging litigation threats to industry.

The proposal drew ire, in part, because it would rely on a contingency fee agreement, which allows a private firm to do legal work for attorneys general offices in exchange for a cut of the settlement. It’s an increasingly common practice because it allows cash-strapped AG offices to tackle expensive litigation without taking as much risk.

“Pay-to-play relationships between [plaintiff’s attorneys and attorneys general] that exchange campaign contributions for lucrative government lawsuit contracts mean the food industry has a big target on its back,” said Lisa Rickard, president of the U.S. Chamber Institute for Legal Reform.

For now, McDonald is hoping to get a working group started through the National Association of Attorneys General. He wants states to coordinate on any future legal strategy from the very beginning.

Moore, Mississippi’s attorney general from 1988 to 2004, recalls how he first attempted to organize states around a similarly contentious cause in the early ’90s. He tried to set up a meeting at an NAAG conference to discuss taking on the tobacco industry, but he was unable to get a spot on the agenda or even a conference room.

“The issue was too controversial,” Moore says, so a small group of AGs met around some couches in a hallway. “Nobody thought we had a chance to win.”

Moore ended up filing the first lawsuit against the tobacco industry and spearheaded what would become the largest class action settlement in U.S. history.

When asked about attempts to take on the food industry, however, Moore doesn’t sound convinced.

“It’s just not the same,” said Moore, who now has his own law firm. “There is no safe use of cigarettes, but we live off food.

“I’d never say you can’t make a case. That’s all I heard for five years,” he said. “But you’d really have to have some significant proof.”

Audio File: 2014 Farm Bill Dairy Provisions

Dave Ladd, President of RDL & Associates was recently a guest on Little Falls Radio to discuss passage of the 2014 Farm Bill.  The audio file providing a brief summary of the dairy provisions contained within the new farm bill can be accessed by visiting:

https://www.dropbox.com/s/24wfz3cjh3xntpd/KTLK%20Radio%20-%202014%20Farm%20Bill%20%28Dairy%20Provisions%29.mp3

For more information regarding Little Falls Radio, please visit http://www.fallsradio.com

 

 

Agricultural Act of 2014: Summary of Key Provisions – Dairy

Moving away from decades-old dairy programs predicated on government purchases of dairy products to counter downturns ,the Agricultural Act of 2014 moves the dairy sector towards a paradigm that moves toward one that has market signals in it to deal with overproduction.

The cornerstone of the new dairy provisions is the establishment of a margin protection program.

Not later than September 1, 2014, the Secretary of Agriculture is to establish and administer a margin protection program for dairy producers under which participating dairy operations are paid a margin protection payment when actual dairy production margins are less than the threshold levels for a margin protection payment.

The United States Department of Agriculture (USDA) will determine the production history of each dairy operation based on its highest annual milk production in the 2011, 2012 or 2013 calendar years, which will be increased by the U.S. average production growth rate in subsequent years.

A dairy operation that has been in operation for less than a year will have the option of determining production history using one of the following methods:

  • The volume of the actual milk marketings for the months the dairy has been in operation, extrapolated to a yearly amount.
  • An estimate of the actual milk marketings of the dairy based on the herd size of the operation relative to the national rolling herd average data published by the USDA.

If a participating dairy operation is operated by more than one dairy producer, all of the dairy producers of the operation will be treated as a single dairy operation.  If a producer operates two or more dairy operation, each operation will be required to register separately in order to participate in the margin insurance protection program.

Margin Calculations

The margin between the average cost of feed, based on soy meal, corn and alfalfa hay prices, and the national average all-milk price will be insurable.  The average feed cost means the cost of feed used by a dairy operation to produce a hundredweight of milk using the sum of the following multipliers:

Feed Stock                              Multiplier

Corn (per bushel)                    1.0728

Soybean Meal (per ton)          0.00735

Alfalfa Hay (per ton)               0.0137

The calculation of the national average feed cost for corn and alfalfa hay will be based upon the monthly Agricultural Prices report.  The calculation of the national average feed cost for soybean meal will be tied to the monthly central Illinois price, as reported in the Market News – Monthly Soybean Meal Price Report issued by the USDA.

The term “all milk price” means the average price received, per hundredweight of milk, by dairy operations for all milk sold to plants and dealers in the United States.

The calculation of the actual dairy margin will be based upon each consecutive 2 month period by subtracting the average feed cost for that consecutive 2-month period from the all-milk price for that consecutive 2-month period.

Margin Insurance Premium Structures

The annual producer premiums per hundredweight for the first 4 million pounds of production included in the production history of a participating dairy operation are as follows:

Coverage Level           Premium per Hundredweight

$4.00                           None

$4.50                           $0.010

$5.00                           $0.025

$5.50                           $0.040

$6.00                           $0.055

$6.50                           $0.090

$7.00                           $0.217

$7.50                           $0.300

$8.00                           $0.475

The premium per hundredweight for each coverage level specified in the above table (except the $8.00 coverage level) is to be reduced by 25 percent for each of calendar years 2014 and 2015.

The annual producer premiums per hundredweight in excess of 4 million pounds of production included in the production history of a participating dairy operation are as follows:

Coverage Level           Premium per Hundredweight

$4.00                           None

$4.50                           $0.020

$5.00                           $0.040

$5.50                           $0.100

$6.00                           $0.155

$6.50                           $0.290

$7.00                           $0.830

$7.50                           $1.060

$8.00                           $1.360

The premium scale was designed to favor farms with fewer than 200 cows without imposing penalties on larger-scale operations that produce most of the milk in the United States.

Under the new program, dairy producers who choose to expand beyond average U.S. growth will not be able to protect the additional milk production.  There is, however, no significant penalty built into the program except the potentially lower market price for the additional milk sales.

Other Provisions

In addition to the margin insurance program, the new farm bill ends the Dairy Product Price Support and the Milk Income Loss Contract programs, establishes a system by which the USDA will buy packaged dairy products during low-margin periods.

The dairy check off, dairy forward pricing and the Dairy Indemnity Program – which pays dairy producers forced to destroy milk contaminated with pesticides through no fault of their own – are all extended through December 31, 2018.

Copyright © 2014 RDL & Associates, LLC.  All rights reserved.

Audio File: 2014 Farm Bill Crop Insurance Provisions

Dave Ladd, President of RDL & Associates was recently a guest on the Linder Farm Network to discuss passage of the 2014 Farm Bill.  The audio file providing a brief summary of crop insurance provisions can be accessed by visiting:

https://www.dropbox.com/s/kk8d6j8ksboyc0v/Summary%20-%20Crop%20Insurance.mp3

For additional information regarding the Linder Farm Network, please visit http://www.linderfarmnetwork.com/

Audio File: 2014 Farm Bill Commodity Payment Mechanisms

Dave Ladd, President of RDL & Associates was recently a guest on the Linder Farm Network to discuss passage of the 2014 Farm Bill.  The audio regarding commodity payment mechanisms can be accessed by visiting:

https://www.dropbox.com/s/ls4mdwbkgjswg9d/Summary%20-%20Commodity%20Payment%20Mechanisms.mp3

For more information regarding the Linder Farm Network, please visit http://www.linderfarmnetwork.com/