All signs point toward reduced beef supplies
Declining dairy cow inventories, no growth in dairy replacement heifer inventories and beef heifer inventories that are declining more rapidly than beef cow inventories imply continuing liquidation of the national cow herd. The other-heifer category contributes to short-term beef supplies, but the combination of reduced replacement heifer inventories, increased short-term heifer beef and declining placements of cattle in feedlots will likely result in reduced beef supplies beyond 2009.

Beef exports declined slightly in the second quarter as demand from Canada, Mexico and South Korea remains weaker than last year. The United States imported 14 percent more beef in the second quarter compared with 2008, mainly due to increased exports from Australia and New Zealand. Imports are expected to increase in 2009 and 2010.
Source: USDA, Livestock, Dairy and Poultry Outlook, Aug. 19, 2009

FAO: A hungry world needs ag investments
Agricultural investment in developing countries will have to increase more than fivefold to ensure that by 2050 the world has enough to eat, according to the United Nations Food and Agriculture Organization (FAO).

Poor countries will need a yearly $44 billion of development assistance in agriculture compared with the current $7.9 billion, FAO Director-General Jacques Diouf said at a summit in Rome recently.

By 2050, world population is expected to rise from 6.7 billion people to 9.1 billion and the world’s food output will have to increase by 70 percent, according to FAO.
Source: AFBF Executive Newswatch, Oct. 13, 2009

Bumper corn crop should help ethanol
The U.S. ethanol industry is enjoying improved profits thanks to a bumper corn crop and relatively high energy prices. Lower corn prices are the biggest plus.

"Demand for ethanol is increasing and my guess is crude oil will go higher, which helps the case for ethanol," said Jerry Gidel, analyst for North America Risk Management Inc.

Traders are expecting a huge corn crop of nearly 13 billion bushels. That’s almost a billion bushels more than last year and close to the record crop of 13.1 billion produced in 2007.
Source: AFBF Executive Newswatch, Oct. 8, 2009

Estate tax exemption changes due in 2010-2011
The current Federal estate tax exemption is $3.5 million per person and the top rate is 45 percent.

Without congressional action, estate taxes will temporarily be repealed for one year in 2010.

Then, in 2011, the tax would resume with a $1 million exemption and a top rate of 55 percent.
Source: AFBF Public Policy Bulletin, Oct. 23, 2009

Fewer believe in global warming
A poll of 1,500 adults released recently by the Pew Research Center for the People and the Press shows that the percentage of people who believe in global warming has declined significantly.

According to the poll, 57 percent accept global warming, down 20 points in just three years. In April 2008, 71 percent of those polled said there is strong evidence that the Earth is getting warmer. In 2006, that number stood at 77 percent in the poll.

Support also is dropping for the idea that man is causing global warming. Thirty-six percent of those polled believe that now, compared to 47 percent last year.
Source: AFBF Executive Newswatch, Oct. 23, 2009

Interest in ACRE is low
Interest in the Average Crop Revenue Election (ACRE) ran low. USDA said 128,620 farms (7.7 percent) opted for ACRE for 2009.

In the preliminary results, total enrollment in the Direct and Counter-cyclical Program (DCP) and ACRE is 255 million base acres on 1.7 million farms. ACRE enrollment covers about 13 percent of base acres, according to USDA.

Other highlights in the data:

• Corn had the highest number of base acres enrolled, followed by wheat and soybeans.

• It’s not a cotton or rice program. USDA data shows eight rice farms and 966 farms opted for ACRE.

• Illinois had the most farms enroll, followed by Iowa, Nebraska and Oklahoma.
Source: Pro Farmer, Oct. 24, 2009

USDA, IRS ‘close’ on income verification
Pro Farmer has been told the issue of the IRS examining tax data for USDA to verify farm income is in the final clearance stages.

The form you will have to sign for verification is reportedly in place.
Source: Pro Farmer, Oct. 24, 2009

COOL dispute panels blocked by U.S.
Two World Trade Organization (WTO) dispute panel requests filed against the United States were successfully blocked on Oct. 23.

Mexico requested a WTO dispute panel as a further step in their complaint against the U.S. country of origin labeling (COOL) program for beef and pork.

Mexico’s request for a panel followed a similar complaint filed days earlier by Canada. The two countries claim COOL has made U.S. processors reluctant to buy Canadian and Mexican livestock and meat.

According to WTO rules, member countries have the right to block a dispute panel once, so it is likely that both requests will be repeated and the process will move forward. The request could come up again as early as Nov. 19.
Source: Executive Newswatch Oct. 26, 2009

Low commodity prices slow large tractor sales
Sales of farm-size tractors and combines held up through the struggling economy for a while, but lower commodity prices are catching up now and sales are down significantly.

Two-wheel drive tractors of 100+ horse power were down 37 percent in September compared to the previous year and declined 13 percent from year-to-date. Combines, which held up the longest, were down 9 percent in September, but are still up 22 percent for the year.
Source: Doane’s Agricultural Report, Oct. 23, 2009, Vol. 72, No. 43-1

PETA to EPA: Regulate ‘factory farm’ emissions
People for the Ethical Treatment of Animals (PETA) wrote to Environmental Protection Agency (EPA) Administrator Lisa Jackson recently, calling on her to curtail greenhouse gas emissions from "factory farms and slaughterhouses."

The request comes as the Obama administration moves toward enabling EPA to regulate greenhouse gas emissions from industrial facilities. The letter cites data from the United Nations, the University of Chicago and EPA to demonstrate that meat production has a more devastating impact on the environment than almost any other major source of pollution.

"We urge the EPA to hold the meat industry accountable for the havoc it wreaks on the environment," said PETA Executive Vice President Tracy Reiman. "But the most powerful thing that any person can do to help the planet is to stop eating animals."
Source: AFBF Executive Newswatch, Oct. 9, 2009

SURE sign up starts this month
USDA plans to start signup in November for the Supplemental Revenue Assistance Payments (SURE) Program, the disaster program enacted by the 2008 Farm Bill.
Source: Pro Farmer, Oct. 17, 2009, Vol. 37, No. 42

Tighter world stocks may help farm prices
With consumption rising as the global economy begins to recover and production stagnating (because of relatively low prices), global stocks are now forecast to take the biggest hit in seven years. Most of that drop will be in foreign markets. Tighter world stocks should help support world prices. The U.S. farm price is currently forecast to be up 10 percent.

The widening gap between world consumption and production means more import demand. However, U.S. exports are forecast to drop by 23 percent, in part, because overall U.S. supply is at the lowest level in 11 years. Also, higher early season prices and large carry-in foreign stocks, coupled with relatively tight U.S. carry-in stocks, will constrain early-season U.S. exports. As a result, the U.S. share of world trade will fall from the record set last year to the lowest level in decades.
Source: USDA-FAS; Cotton: World Markets and Trade, August 2009

Some tax credits expire end of year
Just a reminder that two tax credits will expire at the end of this year.

Producers can write off 50 percent of certain capital investments this year and set the remaining cost up in a normal depreciation schedule.

Also, under IRS Section 179, producers can still write off up to $250,000 of the cost of new or used equipment this year. This benefit is part of the overall stimulus package but the amount a farmer can write off will drop back down to $130,000 for 2010.

Be sure to consult a tax advisor if you plan to take advantage of these tax credits.Source: Doane’s Agricultural Report, Oct. 23, 2009, Vol. 72, No. 43-1