March 2016
Ag Insight

Ag Insight

Wetland mitigation banking program launched

The U.S. Department of Agriculture has announced the establishment of the Natural Resources Conservation Service Wetland Mitigation Banking Program under provisions of the 2014 Farm Bill. Through the program, NRCS will provide $9 million to help states, local governments or other qualified partners develop wetland mitigation banks to restore, create or enhance wetland ecosystems and broaden the conservation options available to farmers and ranchers so they can maintain eligibility for other USDA programs.

Wetland mitigation banking is a market-based approach that involves restoring, creating or enhancing wetlands in one place to compensate for unavoidable impacts to wetlands elsewhere. Wetland mitigation banking is commonly used to compensate for wetland impacts from development, but can also be used to offset impacts from agriculture.

NRCS is seeking applications from eligible third parties to develop wetland mitigation banks or modify existing banks to better serve agricultural producers. These third parties include federally recognized Indian tribes, state and local units of government, for-profit entities and nongovernmental organizations.

The maximum award provided through this announcement is up to $1 million. This funding may be used to cover administrative and technical costs, but may not be used to purchase an easement or any other interest in land.

Partners will develop, operate and manage the wetlands mitigation banks with technical oversight from NRCS and will market mitigation credits to farmers and ranchers. Credits must be made available to producers within two years after the agreement is signed.

USDA is now accepting project proposals for the program. Proposals are due to NRCS before 5 p.m. (Eastern time) March 28. The announcement and associated forms can be found at www.grants.gov.

 

Pork output grows despite decline in breeding herd

U.S. annual pork production has grown by more than 63 percent since 1990 and in 2015 reached an all-time record of more than 24.3 billion pounds.

Over the same period, the size of the U.S. hog breeding herd declined by more than 13 percent, reflecting strong productivity increases in hog production. Technical innovation in breeding and genetic research have combined to yield larger numbers of piglets per sow: U.S. average litter rates grew from fewer than eight pigs per litter in 1990 to more than 10 today.

At the same time, improvements in nutrition and barn management practices, together with heavier slaughter weights, have allowed the hog industry to reduce the size of its breeding herd while expanding production of pork.

Ag productivity has risen dramatically

 

Recently updated figures reveal U.S. farm sector output grew by 170 percent from 1948 to 2013 with about the same level of farm-input use over the period, meaning the positive growth in farm sector production was substantially due to productivity increases.

While aggregate-input use in agriculture has been relatively stable over time, the composition of agricultural inputs has shifted. Between 1948 and 2013, labor use declined 78 percent and land use in agriculture dropped 26 percent, while the use of intermediate goods (such as energy, agricultural chemicals, purchased services and seed/feed) and capital (farm machinery and buildings) expanded.

Long-term agricultural productivity is fueled by innovations in animal/crop genetics, chemicals, equipment and farm organization resulting from public and private research and development.

In the chart, agricultural total factor productivity is the difference between the aggregate total output of crop/livestock commodities and the combined use of land, labor, capital and material inputs employed in farm production.

Chicken rules the roost in meat consumption

Whether it’s due to the popular television commercials in which cows urge us to eat more "chickn" or more simple economic factors, chicken still rules the roost as far as U.S. meat consumption is concerned.

According to USDA’s Economic Research Service figures from 2013, the most recent year for which complete data are available, 57.7 pounds of chicken per person on a boneless, edible basis were available for Americans to eat, compared to 53.6 pounds of beef and 43.4 pounds of pork.

From 1909 to the early 1940s, chicken availability had been around 10 pounds per person a year, while yearly per-person beef and pork availability had ranged from 30 to 50 pounds. Chicken began its upward climb in the ’40s as innovations in breeding, mass production and processing made the product more plentiful, affordable and convenient for the dining-out market and for cooking at home.

By ’96, chicken had overtaken pork as the second-most-consumed meat and, in 2010, chicken overtook beef for the No. 1 spot. Beef availability rose during the second half of the last century, peaking at 88.8 pounds per capita in 1976. Pork availability that had fallen in 2010 and 2011 was up in 2012 and again in 2013.

U.S. ag exports, positive trade balance decline in 2015

 

In fiscal year 2015 (Oct. 1-Sept. 30), the value of U.S. agricultural exports fell by 8.3 percent while imports grew by 4.5 percent, cutting the trade balance to $25.7 billion.

The forecast for FY 2016 is for this pattern to continue. Lower exports and higher imports are expected to push the agricultural trade surplus below $10 billion for the first time since 2006. Lower commodity prices account for some of the decline in the value of exports, but a stronger U.S. dollar also plays a role.

The value of U.S. agricultural exports and imports increased yearly from FY 2009 through FY 2014, when the agricultural trade balance reached an all-time high of $43.1 billion.

Unlike 2009 when both exports and imports fell due to the global recession, in 2015 and 2016 imports are growing at the same time that exports are falling, reflecting the greater purchasing power of the U.S. dollar in international markets and the reduced purchasing power of foreign currencies to buy U.S. goods.

StrikeForce efforts expanding

A recent expansion of USDA’s StrikeForce for Rural Growth and Opportunity Initiative means that 970 counties, parishes, boroughs and census areas in Alabama and two dozen other states are now eligible for "intensive care" through the program.

Launched in 2010, more than 1,500 StrikeForce partnerships already have helped USDA support nearly 190,000 projects and have yielded investments of $23.5 billion in high-poverty locations in rural America.

Some 85 percent of the nation’s persistent poverty counties currently are in rural areas.

USDA’s StrikeForce focuses on partnerships with community organizations, businesses, foundations, universities, faith-based and other groups to help challenged communities shape a future based on local assets and regional strengths.

USDA identifies census tracts with over 20 percent poverty to pinpoint sub-county pockets of poverty. As areas of persistent poverty are identified, USDA personnel work with state and local officials to increase awareness of the agency’s programs and help build participation through community outreach and technical assistance.