June 2016
Ag Insight

Ag Insight

Applications sought for rural broadband grants

The U.S. Department of Agriculture has announced it is soliciting applications for grants to establish broadband in unserved rural communities through its Community Connect program. The deadline for either paper or electronic submissions is June 17.

Community Connect is administered by USDA’s Rural Utilities Service and helps fund broadband deployment into rural communities where it is not economically viable for private sector firms to provide service.

"Through Community Connect and our other telecommunications programs, USDA helps to ensure rural residents have access to broadband to run businesses, get the most from their education and benefit from the infinite services that fast, reliable broadband provides," Agriculture Secretary Tom Vilsack said.

USDA plans to award up to $11.7 million in grants through the Community Connect grant program. The agency has invested $160 million in over 240 projects to bring broadband to unserved rural communities since the program was created in 2002.

The minimum grant is $100,000 for fiscal year 2016. The maximum award is $3 million. USDA announced new rules in 2013 to better target Community Connect grants to areas where they are needed the most. To view the rules, go to www.gpo.gov/fdsys/pkg/FR-2016-04-18/pdf/2016-08931.pdf.

Prior Community Connect grants cannot be renewed. However, existing Community Connect awardees may submit applications for new projects that USDA will evaluate as new applications.


Nearly 61 percent of food dollar goes to three industry groups


With total food-away-from-home expenditures of U.S. consumers, businesses and government entities surpassing at-home food sales since 2014, the 32.7 cent foodservices share of the U.S. food dollar claimed by restaurants and other eating-out places probably comes as no surprise.

When that share is added to the 15.3 percent accounted for by food processors and 12.9 percent that goes to grocery stores and other food retailers, the total share of these three groups is 60.9 percent, according to USDA’s Economic Research Service.

As the foodservices segment has grown, the food dollar shares of retailers and processors have declined. The percentage going to retailers is at its lowest level since 2002 while food processing’s share is down 2.1 cents since 2009.

ERS uses input-output analysis to calculate the value added, or cost contributions, from 12 industry groups in the food-supply chain. Annual shifts in food dollar shares between industry groups occur for a variety of reasons, ranging from the mix of foods consumers purchase to relative input costs.

One bright spot is that a growing share of the food dollar has gone to farmers and ranchers, up 1.7 cents since 2009 to 10.4 cents in 2014.


Auburn University receives USDA nanotechnology research grant

Auburn is one of 11 universities that have received USDA grants totaling over $5.2 million to support nanotechnology research.

The universities will research ways nanotechnology can be used to improve food safety, enhance renewable fuels, increase crop yields, manage agricultural pests and for other purposes. The awards were made through the Agriculture and Food Research Initiative, the nation’s premier competitive, peer-reviewed grants program for fundamental and applied agricultural sciences.

With its funding, Auburn proposes to improve pathogen monitoring throughout the food-supply chain by creating a user-friendly system that can detect multiple foodborne pathogens simultaneously, accurately, cost effectively and rapidly.

Others receiving grants include the University of Georgia, Mississippi State University, Clemson University in South Carolina, and Virginia Polytechnic Institute and State University.


Milk cow numbers, production on the rise


The number of milk cows in the United States was up slightly in 2015, reaching 9.3 million, about equal to the number in 2008.

At the same time, improving technology and genetics have allowed milk output per cow to rise steadily, increasing by 88 percent since 1980 and reaching a record-high annual average of 22,393 pounds of milk per cow in 2015.

The result has been strong growth in U.S. milk production over the period corresponding to growing domestic and international markets for dairy products, particularly for cheese and various dairy-based food ingredients.

The size of the U.S. dairy herd reached an historic low of just over 9 million cows in 2004, following a long-term decline of over 2 million head since 1983. Over the past decade, the herd size has grown slightly by an average of 0.3 percent per year.


Dairy program modified for growth in family farms

USDA has announced that dairy farms participating in the Margin Protection Program can now update their production history when an eligible family member joins the operation. The voluntary program, established by the 2014 Farm Bill, protects participating dairy producers when the margin – the difference between the price of milk and feed costs – falls below levels of protection selected by the applicant.

The change not only helps to strengthen a family dairy operation, it also helps new dairy farmers get started in the family business and ensures that safety net coverage remains available for these growing farms, USDA officials said.

USDA’s Farm Service Agency has published a final rule making the changes effective.

Any dairy operation already enrolled in the MPP and that had an intergenerational transfer occur will have an opportunity to increase the dairy operations production history during the 2017 registration and annual coverage election period.

The next election period begins July 1 and ends Sept. 30, 2016. For intergenerational transfers on or after July 1, notification must be made to the FSA within 60 days of purchasing the additional cows. Each participating dairy operation is authorized one intergenerational transfer at any time of its choosing until 2018.


Meat, poultry exports expected to increase


U.S. red meat and poultry exports are expected to rise during the next decade as steady global economic growth supports demand for high-quality animal protein.

A strengthening U.S. dollar, coupled with poultry trade restrictions related to highly pathogenic avian influenza, led to a reduction in U.S. meat and poultry exports in 2015, but longer-term trends should reverse the decline in coming years – according to USDA trade experts.

Poultry is the largest U.S. meat export category, and broiler export growth is expected to resume within the next decade with strong near-term gains reflecting a rebound from HPAI-related import restrictions. China and Mexico are major U.S. broiler export markets.

Pork exports are projected to continue rising, with Pacific Rim nations and Mexico among the key growth markets.

U.S. beef exports are projected to grow as well, consisting mostly of high-quality grain-fed beef shipped to Mexico, Canada and Pacific Rim nations.


China leads world in apple production

Apples are produced commercially in over 90 countries worldwide, with annual combined global production of about 80 million metric tons.

China is the world’s largest producer, accounting for nearly half the global output and producing nearly 10 times the volume of the United States that produces the world’s second largest apple crop.

China’s large production volume is supported by the country’s vast production area. However, U.S. yields are nearly double the average achieved in China.

Area expansion in China has slowed during the past decade, but per-hectare yields have improved, aiding the country’s production increases.


Organic operations continue to rise

USDA statistics show a significant increase in the number of certified organic operations, continuing the trend of double-digit growth in that sector.

According to new data, there are now 21,781 certified organic operations in the United States and 31,160 around the world.

"Organic food is one of the fastest-growing segments of American agriculture," said Agriculture Secretary Tom Vilsack. "As consumer demand for organic products continues to grow, the USDA organic seal has become a leading global standard."

According to data released by the Agricultural Marketing Service’s National Organic Program, the number of domestic certified organic operations increased by almost 12 percent between 2014 and 2015, representing the highest growth rate since 2008 and an increase of nearly 300 percent since the count began in 2002.

The total retail market for organic products is now valued at over $39 billion in the United States and over $75 billion worldwide.