News Update
February 10, 2012
U.S. Farm Exports Reach Record $136.3 Billion in Calendar Year 2011
"The data released today by USDA represents a record-breaking calendar year for farm exports, demonstrating — once again — that American agriculture remains a bright spot in our nation's economy," Agriculture Secretary Tom Vilsack commented in announcing U.S. farm exports of $136.3 billion in 2011.
Each $1 billion in agricultural exports, he said, supported 8,400 American jobs. All in all, U.S. farm exports helped support more than 1 million U.S. jobs in 2011.
Vilsack called beef exports a success story.
"Last year, the United States exported an all-time high of $5.4 billion worth of beef and beef products, surpassing the previous record by more than $1.6 billion," he noted. "The volume of shipments also surpassed the 2003 levels, the last year before a detection of bovine spongiform encephalopathy (BSE) in Washington State disrupted U.S. trade."
While the United States has reached a milestone with beef exports returning to pre-2003 levels, trade barriers are still in place that limit the United States from reaching its full export potential, Vilsack pointed out.
"There was more good news for U.S. beef exporters when United Arab Emirates (UAE) officials issued a decree on Jan. 24, 2012, liberalizing imports of U.S. beef by eliminating age restrictions."
The latest export data is available via the Global Agricultural Trade System at http://www.fas.usda.gov/data.asp.
Finding Common Ground: Ways to End the Partisan War
How to stop the partisan war that is destroying America was the topic addressed by keynote speakers Bob Beckel and Cal Thomas at the General Session II convened Thursday, Feb. 2, at the 2012 Cattle Industry Convention in Nashville, Tenn.
Beckel and Thomas are known for their USA Today column called "Common Ground," and the political duo has authored a book with the same title. Surprisingly, Beckel is a liberal Democratic strategist and Thomas is a conservative columnist.
Thomas kicked off his address to cattlemen by saying, "We're familiar with your industry because we deal with bull all the time in Washington, D.C."
Thomas noted that he and Beckel often have different views, but he emphasized they are still Americans and maintain the utmost respect for one another despite that.
"There's plenty of room for different opinions," Thomas said. However, he noted, "We all suffer when our trust in government wanes." That is why, he said, Americans must come together to find "common ground."
As a liberal, Beckel asked the crowd not to make assumptions about things — and people — they don't know. "There are a lot of different liberals," he explained.
"There's so much polarization in Washington because both political parties have gone to the extremes," Beckel added. As a result, the people's business is not getting done.
Beckel and Thomas emphasized that people representing both political parties need to come together to resolve the issues.
Thomas stated that liberals like his friend Bob Beckel aren't the enemy. Rather, he said, "The Taliban is on the other side. Let's put them — the real enemy — where they belong."
Thomas encouraged Americans to "stop demonizing people who have different beliefs and promote the general welfare of people. Because, when we promote the general welfare, we promote our own as well."
Beckel noted that in order for progress to be made, people with different political views must be able to come to the table, discuss and then leave the table in a civil way.
"Let's take time, sit down and listen to one another, and we may find common ground," he concluded.
Cattle Producers Advised to Use Caution as Prices March Higher
Cattle producers should be mindful to not get too caught up in reacting to high market prices, according to a Texas AgriLife Extension Service economist.
When Jason Johnson, AgriLife Extension economist from Stephenville, showed a slide to several hundred cattle producers at the Blackland Income Growth Conference in Waco, Texas, it caused many to gasp and begin conversations about profit potential.
"I put this (slide) up there not to make you salivate, but to put things into perspective," Johnson said. "You can get into a bind making certain decisions during prosperous times."
He advised producers not to overstock due to the potential for continued drought conditions in Texas.
But if the dry weather patterns tend to alter from last year's devastating drought, "if we get some rain, you've got a real good shot at making some good money here. The price outlook is really looking good," Johnson said.
To play it safe, Johnson said producers might want to consider stocking at 75% of normal capacity.
"That way if we get 80% to 90% normal rainfall, you won't have to cut into the bone of the herd to destock," he said. "If we get normal rainfall or better, there are many alternatives available to harvesting excess forage."
Target prices for the first quarter of 2012 for 500- to 600-pound (lb.) calves are $1.45 to $1.50, which has already been exceeded this year, Johnson said. That trend is likely to continue with a historic shortage of beef cows not seen in the U.S. since 1952.
Profitability for Texas ranchers relies on using the availability of forage and reducing the amount of purchased feed, Johnson said.
"The (calf) prices are there, the challenge for us is to produce a calf cheap enough," he said.
The outlook for corn prices continues to be on the upswing, Johnson said, due to declining carryover stocks from last year. He expects feed prices to remain level or increase a bit "due to these supplies and the renewable fuel standard tapping into corn to make ethanol."
Texas hay prices continue to be a threat to profit margins as well for ranchers, he said.
"You can spend a lot of money raising that $1.50-per-pound calf on hay," he said. "Cattle producers might want to consider storing hay supplies for up to two years if ample rainfall is received this spring and summer, and if enough hay is harvested.
"Saving two years worth of hay supplies allows you to sidestep a year like 2011 when hay prices were out of sight."
Ranchers can also consider the many weather-related insurance products as a hedge against drought conditions, Johnson said.
With 2011 federal income tax returns set to be filed in mid-April, Johnson said cattle producers can consider deferring taxes on the sales of excess breeding livestock if the proceeds are used to purchase replacements within the next two years.
"You don't have to pay tax on excess sales due to drought," he said. "If you normally sell one-fifth of your breeding animals, anything in excess of that one-fifth you can defer taxes on and use those proceeds for replacement."
A second tax-management option applies to non-breeding livestock. Ranchers whose principal business is farming and ranching can defer taxes on sales proceeds resulting from disaster conditions for up to one year, Johnson said.
There are several online spreadsheets made available by AgriLife Extension economics that can assist ranchers with management decisions, Johnson said. For more information, go to http://agecoext.tamu.edu .
Chairwoman Stabenow Announces Farm Bill Hearing Schedule for February, March
Senator Debbie Stabenow, chairwoman of the U.S. Senate Committee on Agriculture, Nutrition and Forestry, Feb. 1 announced the Committee's Farm Bill hearing schedule for February and March, noting that the Committee will continue examining Farm Bill principles and evaluating policy solutions to develop a 2012 Farm Bill. To see the schedule, visit http://www.ag.senate.gov/newsroom/press/release/chairwoman-stabenow-announces-farm-bill-hearing-schedule-for-february-march .
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