Tag Archives: press-releases
Support To Agriculture Rising After Hitting Historic Lows – OECD
By: Viola Caon 20 Sep 2013 Government support for agriculture in the world’s leading farming nations rose during 2012, bucking a long-term downward trend and reversing historic lows recorded in 2011, according to the latest version of an annual OECD report. Public support to producers stood at an average one-sixth of gross farm receipts in the 47 countries covered in OECD Agricultural Policy: Monitoring and Evaluation 2013. The Producer Support Estimate has increased to 17% of gross farm receipts in 2012, compared to 15% in 2011, according to the new analysis. The OECD sees a generalised move away from support directly linked to production, but finds that support that distorts production and trade still represents about half of the total. While OECD countries are increasingly de-linking support from production, emerging markets are relying more on border protection and market price support measures that tax consumers. “With world markets for food and commodities buoyant and higher commodity prices expected to continue, the time is ripe for governments to credibly commit to wide-ranging farm support reform,” said OECD Trade and Agriculture Director Ken Ash. “Meeting the needs of a growing and richer world population requires a shift away from the distorting and wasteful policies of the past towards measures that improve competitiveness, allowing farmers to respond to market signals while ensuring that much-needed innovation is fully funded,” Mr Ash said. This year’s OECD report examines the state of agricultural policy in 47 countries that account for nearly 80% of global farm output, including seven emerging economies that are major players in food and agriculture markets: Brazil, China, Indonesia, Kazakhstan, Russia, South Africa and Ukraine. It shows that support levels vary widely, both across the OECD countries and across major emerging economies. The European Union mirrored the OECD-wide trend, with farm support rising from 18% to 19% of farm receipts. The June 2013 agreement on EU’s Common Agricultural Policy for the 2014-20 period does not represent a major departure from either the current orientation or size of farm support in the 28 country bloc. Some emerging economies which are key players in agriculture continued to increase support – in China farm support rose to 17%, in Indonesia it rose to 21%, and in Kazakhstan support reached 15%. Others maintained low levels of support, like Brazil (5%) and South Africa (3%). Continue reading
Wood: Fastest Growing Heating Fuel In America
October 03, 2013 • Source: USCensus/IHB Recently official released statistics from the US Census Bureau reveal that wood or wood pellets are again the fastest growing heating fuel in America. In 2012, 63.566 more families used wood or pellets as a primary heating fuel, a 2.6% increase over 2011. Wood and pellet home heating grew by 34% in 10 years (2000-2010), ”faster than any other of the fossil fuels, including solar and natural gas”, says US Census. Moreover, oil and propane use continuously declined since 2010. At the present, 2.5 million American households use wood as a primary heating fuel. Comparing with 500.000 that use solar panels and only 50.000 that use solar termal heating, wood is by far the most used renewable energy in the United States. 2.1% of Americans use wood or wood pellets as a primary heating fuel (2000: 1,6%) and 7,7% US households use it as a secondary heating fuel, according to the 2009 EIA Renewable Energy Consumption Survey. The US Census Bureau started recording heating data in 1950. Since then, wood heating has had some discordant fluctuations: in 1950, 10% of the US population was using wood as a heating method; to drop at 1,3% in 1970 at an all-time low. By 1990, this percentage went up to 3,9%, to drop again at 1.6% in 2000. Continue reading
U.S. Farmland Market Cooling Entering Key Auction Season
By Christine Stebbins CHICAGO, Sept 27 | Fri Sep 27, 2013 2:03pm EDT (Reuters) – The red-hot rush for U.S. grain land is cooling after years of record prices, but prime acreage is still attracting top dollar in the heart of the Corn Belt so far this fall, according to land auctioneers. “On higher quality land it’s been pretty strong steady, but on medium and lower quality land we’ve seen some pullback,” said Randy Hertz, CEO of Iowa-based Hertz Farm Management. “There’s a lot of uncertainty out here in terms of what the future holds.” The key season for U.S. farmland sales is October through December, when Midwest and Plains grain farmers are rolling in harvest cash and planning their taxes. Most economists and bankers say it is too early to tell if land values have peaked. “We’ve peaked for right now unless the grain markets rebound sharply, when it might change things and go the other direction. But right now I think is probably a leveling off period,” said Eric Mueller, an auctioneer and broker at Omaha-based Farmers National, the largest farm management company in the country. Recent farmland sales from Ohio to Nebraska have ranged from about $3,000 an acre up to $16,000 for top quality ground. While prices are strong the rate of gain has eased from 2012 when prices jumped 20 percent to 30 percent. “Interest rates are creeping up a little. But, ultimately, I think the biggest factor is grain. There’s still a lot of money out there, but buyers are going to be a little bit less aggressive with the grain markets coming down,” Mueller said. “The sentiment is holding in Nebraska and Iowa.” Corn prices are down 30 percent since last fall on the outlook for a record harvest. But corn revenues this year are still seen strong with higher yields after last year’s drought. “Frankly the last 10 years have been phenomenal. It’s off-the-chart good,” said Brent Gloy, an agricultural economist with Purdue University. “It looks like to me this is the first time we’ve seen some substantial headwinds in the market for a while.” Chicago Board of Trade December corn on March 1 was $5.57, but closed at $4.57 on Thursday. A year ago, the price was $6.20. “If it becomes obvious that corn prices are going to shake out below $4 in the $3 range, we’re at a peak,” Gloy said. “The lower commodity prices are hard to justify the really high land prices we’ve been seeing. If you take high quality farmland in Indiana, if you get much over $10,000 an acre, you’ve got to have cash rents over $300 an acre, in some cases $400 or $500. If corn prices are below $5, it’s going to be hard to pay those rents.” Bankers and economists watch farm land prices closely. Land represents 85 percent of farmer assets – and loan collateral. Federal Reserve banker surveys for the quarter ended in June cited lower rates of gain in land prices. At the same time, bankers cautioned farmers against chasing price dips with borrowed money, dreading another 1980s farm debt crash. “The difference with the 1980s is that 75 percent of land then had mortgages. Today, 25 percent does,” said Jeff Obrecht, an Iowa-based real estate broker with Farmers National. “That makes a big difference. We just don’t have the debt out there that we had. Part of that is lenders are requiring more. If you buy at $10,000 acre, you’re going to have to put $5,000 down.” Auctioneers said that, in recent weeks, more ‘no sales’ have been reported at Midwest auctions as buyers think through revenue, cash and borrowing fundamentals. “When I sold a piece a property two years ago for $14,600 we got there in less than 5 minutes,” said Bruce Huber of Hickory Point Bank in Decatur, Illinois. “Some of these auctions are taking longer, fewer bidders. You can just tell the enthusiasm for the higher prices seems to be wanting yet the prices are still there.” So as land auctions pick up starting in October, auctioneers are expecting some price resilience. “Farmers buy about 70 percent of the farms in the Midwest,” said Hertz. “They’ve got cash, there are record amounts of cash. That cash at a bank or short-term deposits doesn’t pay much – essentially, less than 1 percent. Compare that to a farm that can earn 3-4-5 percent.” (Reporting by Christine Stebbins.; Editing by Andre Grenon) Continue reading
