Economic Tidbits

#$*%()&@#)* Weather!

No doubt expletives have been voiced by folks involved in Nebraska agriculture regarding this year’s weather. Weather is a constant influence on production agriculture, but this year is one for the record books. Farmers’ struggles in getting crops planted have been well documented. Last week’s NASS crop progress report (as of May 26) indicated 81 percent of the state’s corn acres and 56 percent of the state’s soybean acres were planted.

Both progress figures were well below their respective 5-year averages. As such, there were 1.8 million acres of corn and 2.4 million acres of soybeans left to plant at that time. The greatest number of corn and soybean prevented planting acres occurred in 2015 when 104,518 acres of corn and 49,918 acres of soybeans were unplanted. It appears Nebraska may be heading towards another record-setting year for prevented planted acres.

Somewhat overlooked is the struggles this year’s weather has caused for the state’s ranchers. The miserable weather is taking a toll on them too. Higher death losses, animal health issues, greater feed costs, slower grass growth in pastures, flooded pastures (one rancher reported kayaking in one of her hay meadows last week), and reduced animal performance are walloping ranchers this year. Ranchers are unable to turn cows onto pasture due to the lack of grass. Thus, ranchers have been forced to feed cows more hay and feed until pastures are ready, absorbing higher feed costs. Typically, ranchers like to have cattle on grass by early to mid-May. All of this portends of higher costs and lower revenue for a sector already struggling to make a positive return.

Beef, corn, and soybean production are the “bread and butter” of Nebraska agriculture. The three commodities account for over 90 percent of the state’s agricultural receipts in any given year. Although the ultimate economic costs won’t be known until crops are harvested and cows are pregnancy checked later this year, to have the weather cause production disruptions in all three commodities at the same time portends for a difficult year.

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