Agriculture year in review – 2015


As I write this, I am wondering where winter is? The past few days have reminded me of last year in March and not of winter. This time of year is spent on closing our farm records and looking to what the next year has in store for us.

Where has this past year gone? Next year at this time I will probably be saying the same thing. I look back on this past year and I’m glad to see it come to a close.

Each year I remember all the farmers who have left this earth that were stewards of the soil for many years and have passed their knowledge to those who watch over the soils today. There have been many this past year that were the ones who taught me at my job at Keller Grain & Feed when they delivered their crops 17 years ago. It is hard to believe that time passed so quickly.

As I look into the past, the grain markets were determined primarily by the weather. The turbulent weather drove our grain markets to see some major swings in such a short time. From January 1, until the market bottomed on June 15, the corn market traded within a 26-cent trading range. When the rain shut off in June until that “savior” in July the local cash market went from $3.49 to a high of $4.30.

Throughout the fall months until the end of the year the market mimicked the way the year began and traded locally on the cash market within a 21-cent trading range. Soybeans bottomed a little sooner on May 26 and continued their climb until the August 10 trading at the local cash market from $9.17 to a high of $10.84. September until the end of the year soybeans traded within a 58 cent local cash traded range.

Wheat was a horse of a different color again this year due to the torrential down pours that set in the afternoon of July 6. Anything harvested prior to this date held good test weights and low, to no, Deoxynivalenol (also known as vomitoxin); but after that date sprouts started to appears along with lower test weights and molds. The quality of the crop dictated price and where most were able to sell the harvest to.

Most was not made into crackers or flour, but rather fed to chickens and hogs in the southeastern United States. Challenges always burden one crop or another, but no farmer could detect the weather we had for the fall harvest. Thirty-plus days without harvest delaying weather allowed farmers to harvest at a normal pace and allowed to help reduce fatigue by allowing time to rest and repair equipment.

Grain markets were not the only markets that saw a downturn this year. The hog business showed a January 2015 $73/100 weight futures average and by the time December 2015 rolled around hogs were only averaging $57/100 weight futures ($34/100weight cash).

Cattle saw a similar move in the markets with futures starting the year at around $163/100 weight and ending the year close to $120/100 weight. This amounted to $43 decline per hundred or in other terms $500/head on a 1,200 pound animal.

One saving grace is that feed prices stayed relatively level all year.

The livestock market that was completely turned on its head was the poultry market with the introduction of the Avian Flu throughout the Midwest. Hundreds of thousands of birds lost and production issues ensued across the food sector due to the diminished supply of meat and eggs. Prices for these products on store shelves saw dramatic inclines, and as the year ended most facilities were back into production.

In other ag production news, lower fuel prices helped with farmer’s cost overhead and it seems as the year closed out that these trends would continue on into the 2016 crop year. The price of farm ground seems to be plateauing as the prices of grain markets fell off, but for one such property in Western Ohio, this did not seem to matter as it went for a new local record of $17,200/acre.

Unmanned Arial Vehicles(UAV’s or Drones) was the big new thing as more have been rolled out for on-the-farm recreation use and some non-recreational businesses are popping up as the FAA licenses them. Over the few years I have been around agriculture, nothing this big has hit the market since the GPS systems and Technology Traited Seeds. This will be a gamechanger in the coming years and we are only on the door step of what it has to offer.

When looking at agribusiness, we’ve seen many changes this past year and I’m sure there are more to come.

Precision Planting sold to John Deere in a buy and swap deal for Climate Corp to gain access to John Deere’s software platform. Dow and DuPont are set to merge, and coming soon, they plan to restructure this new company into three companies, with one focusing on agriculture. One merger that did not happen this year is the combination of Monsanto and Syngenta; after three different offers to acquire and combine none came to fruition.

When dealing with the government policy side of agriculture, the new Farm Bill took effect. Most grain farmers in Ohio signed up for ARC-CO and it paid out for most depending on their county yields for the corn base acres. Even though a payment was issued on this, some dollars were affected by sequestration.

The Waters of the U.S. (WOTUS) reared its ugly head and the fight continues with the EPA oversight and overreaching control of standing water. As the year closed, this fight was still ongoing in the halls of Congress and in closed door meetings. I, for one, hope for a swift and righteous outcome.

The financial sector is alive and well as we close the year and they even raised the interest rate by 0.25 percent. As a farming sector we all know what that entails for markets, typically if financials are strong, agriculture markets are not. I hope they prove me VERY wrong.

No matter what the world, weather or markets throw at us, we are American farmers and we find a way to survive and be productive. I wish each and every one of you healthy and prosperous 2016.

By Matt Aultman

For Rural Life

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