Farmweek 02 27 2017 E Edition Page 1

and alter its baseline acreage estimates (USDA releases its planting intentions report March 31). The situation caused farm debt levels to climb near $350 billion, and farmland val- ues and cash rents to soften. USDA pegs the current debt to asset ratio at 13.9 percent, up from the low of 11.3 per- cent in 2012. But the ratio remains in much better shape than during the 1980s farm cri- sis when the debt to asset ratio climbed to 22.2 percent. "Some sectors or regions may be struggling more than others," Johansson said. "We also know young farmers (of which about one-third are highly leveraged) and those who rent a large share of their acres face more pressure." USDA estimates 2017-18 marketing year prices to improve slightly from last year to averages of $3.50 per bushel for corn (up 2.9 percent), $9.60 for beans (up 1 percent) and $4.30 for wheat (up 12 percent). The crop price estimates, if realized, still would represent declines of 50 percent for corn and 35 percent for beans from the 2012 highs. Periodicals: Time Valued Monday, February 27, 2017 Two sections Volume 45, No. 9 Improving market access to boost world trade received atten- tion at USDA's outlook forum. page 3 IFB Board members set state legislative priorities, including two bills focused on property rights. page 4 Madison County farmer Kyle Brase and his agronomist earn a national 4R advocate award. page 6 FENCED IN A barbed wire fence frames a Schuyler County farmstead on a spring-like day. Ducks even gathered at the farm pond to enjoy last week's weather. (Photo by Cyndi Wiggs) USDA: Economic issues to prompt acreage switch BY DANIEL GRANT FarmWeek USDA predicts farmers will plant a record amount of soy- beans and fewer acres of corn and wheat this season. The reason for the changes, along with an overall decline in total planted acreage, boils down to eco- nomics, according to Robert Johansson, USDA chief econ- omist. "Farm income is falling more quickly than at any time since the 1970s," Johansson said dur- ing USDA's 93rd annual Ag Out- look Forum in Arlington, Va. USDA estimates farm income this year could total $62.3 billion, down slightly from $68.3 billion last year, but half the record $120 billion earned in 2013. "Production has outpaced consumption for many crops the last four years," Johansson said. "Global stocks have grown, particularly for wheat." Wheat prices continue to hang around $4 per bushel, while corn prices hover in the mid-$3s. But soybean prices remain near or above $10 per bushel. And with lower production costs for beans compared to corn, USDA expects an acreage shift this season, particularly in the western Corn Belt. USDA estimates farmers this season will plant a record 88 million acres of beans, up 5.5 million acres from last year; 90 million acres of corn, down 4.3 million; and 46 million acres of wheat, down 8.3 million. "The last time the (price) ratio was this favorable to soy- beans was in 1997," the chief economist noted. Overall, USDA predicts plantings of the eight major crops in the U.S., including corn, soybeans and wheat, could total 249.8 million acres. If realized, total plantings this year would be down 3.6 million acres from a year ago. "We expect to see an increase in idle acres this year," assuming normal planting weather, Johansson said. "This year, we assume there will be more prevent plant acres." The planting estimates gener- ally are in line with many trade expectations, although some estimates suggest farmers could plant as many as 90 million acres of beans this season. The farm economy contin- ues to grapple with lower com- modity prices that led USDA to trim its farm income forecast Robert Johansson 'Farm income is falling more quickly than at any time since the 1970s' BY DEANA STROISCH FarmWeek An EF4 tornado last year destroyed Ken Wood's farm, home, vehicles, machin- ery and about 300 acres of his crop in cen- tral Kansas. He remains thankful for crop insurance. "I honestly don't think I would have had the courage to start over without hav- ing the protection that crop insurance offers," Wood said. "For most of us, crop insurance will not guarantee a good year, but it offers the promise of another year." Wood testified during a U.S. Senate committee hearing in Kansas last week - the first of many to be held across the United States. Sen. Pat Roberts, R-Kan., said the farm bill hearings began "in the heartland because that is where it matters most - on our farms, ranches, businesses, and city and county halls across the countryside. "No one understands the impacts of farm bills or policies set in Washington like America's farmers, ranchers and rural communities," he said. "Your experience - your story - is what we need to hear before we start writing a new farm bill." Kansas farmers planted 23.2 million acres of crops last year, Roberts said. Live- stock includes 6.25 million cattle, 1.9 mil- lion hogs and more than 140,000 dairy cows. Wood, president of the Kansas Associa- tion of Wheat Growers, said record yields in 2016 resulted in record stockpiles, and in turn, historically low prices. "Many feel that these low prices and a struggling farm economy are what caused Kansas wheat farmers to plant nearly 1 million fewer acres last fall, the second lowest planted wheat acres in Kansas in over a century," Wood said. Low prices and rising costs continue to cause stress this year, he said. The situa- tion, he said, illustrates the need for feder- al programs, such as crop insurance. Representatives from various commodi- ty groups shared similar testimony about the need for a reliable safety net. In all, 18 people testified. Highlights included: Livestock: The Kansas Livestock U.S. Senate kicks off farm bill hearings in Kansas See Hearings , page 4

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