Hot 5: Corn Production. Nebraska GDP. Dr. Daniel Hillel. Farming in Japan. Greenhorns.

1. The Globe Ramps Up Its Corn Production in Response to Higher Prices and Less Price Competition from the U.S.

World coarse grain production in 2012/13 is forecast to increase more than 7 percent to a record 1,228 million tons, boosted by record corn crops by the United States and major foreign producers. U.S. exports and export sales have slumped. Foreign producers, including China, Brazil, Argentina, and Ukraine are expected to respond to the sustained high coarse grain prices of recent years with production of record corn crops. Foreign coarse grain harvested area in 2012/13 is projected up 2 percent due to higher prices.

Corn ethanol use for 2011/12 is projected up 50 million bushels this month to 5,050 million as recent ethanol production data have been stronger than expected. While slowing from its peak in December 2011, ethanol production and use has been partly sustained by ethanol exports, as declining gasoline use and limits to blending ethanol have curbed domestic use.

Brazil’s second-crop corn has received exceptionally favorable rains in areas like Mato Grosso, where the dry season normally cuts corn yield potential. The huge second crop more than offsets reduced first-crop area and below-trend first-crop yields, boosting the total corn production to record levels. For the first time, second-crop yields are estimated higher than first-crop yields, with second-crop accounting for nearly half of corn production. Partly offsetting is a 0.5-million-ton reduction for corn production in Argentina, to 21.0 million as excessive rains and flooding have delayed the corn harvest and caused some yield loses. (Source: USDA)

2. What Gives? Nebraska was Among the Lowest GDP Growth States in 2011.

From the U.S. Bureau of Economic Analysis

Most people would probably assume that the Midwestern farm states did well economically in 2011. Not so. The average U.S. real GDP by state grew 1.5 percent in 2011, after a 3.1 percent increase in 2010, and a negative 3.8 percent in 2009. But the higher growth states in 2011 were coastal, with subpar performance down the center of the nation.

Here is the list of states in the lowest tear from this latest Bureau of Economic Analysis Report:

Wyoming -1.2
Mississippi -.8
Alabama -.8
New Jersey -.5
Maine -.4
Hawaii -.2
Montana 0
Missouri 0
Nebraska .1
New Mexico .2

Experts in the state of Nebraska are stumped by the report, since the hype has all been positive about high agricultural returns last year. Creighton’s economist Ernie Goss who does the Rural Mainstreet Reports says he can’t explain it.

I have to wonder whether Nebraska might be exporting its Ag profits at the expense of its land and aquifer. Though it’s known as a “farm state”, agriculture isn’t that big of an employer or income generator in Nebraska. It always surprises people when they learn that Omaha is the headquarters for five Fortune 500 companies. The famous rich man “I’ll-let-you-pay-millions-for-the-privilege-of-taking-me-out-for-lunch” Warren Buffett certainly doesn’t employ many people in his office. Agribusinesses headquartered elsewhere collect much farm profit when Ag inputs are high. Ethanol, one of the main drivers of the Nebraska farm economy right now employs few people and the plants are often owned by agribusinesses like ADM. Unemployment rates in Nebraska, always touted as so fabulously “low”, in reality are low because people quickly leave brain-drain states if they don’t have jobs. Yes, real estate and farmland prices are strong but that’s on paper, and houses are still cheap compared to the rest of the country. Nebraska is known as a tax-me state. Aging and conservative populations don’t help with the velocity of money, either.

Is this a nonstory? I don’t think so. The story here is that our natural resources of Midwestern topsoil and water are being mined without all that much local economic gain, even with the gimmee corn ethanol mandate which has about tripled corn prices. What might surprise many is that farm income was only 5.7% of Nebraska income in 2008 and agriculture represented only 6.8% of Nebraska’s GDP in 2008. The environmental destruction of the region due to agriculture contributes to its brain drain and aging demographics.

Nebraska is the third largest corn producing state after Iowa and Illinois. It is using 45.6 million acres, or 92.7 percent of its land for farming (and ranching) on a total of 47,200 farms. Corn and soybeans are grown on 32 percent of that land. Nebraska has the most irrigated acres of any state at 8.6 million.

Frank and Deborah Popper, help me out here.

3. Dr. Daniel Hillel Named 2012 World Food Prize Laureate

Eighty-one year old Israeli Professor Daniel Hillel has won the World Food Prize 2012, a prize which was founded in 1986 by Dr. Norman E. Borlaug. Fascinated with growing food under extremely tough growing conditions, he was among the first to develop the idea of using drip or micro-irrigation, now embraced as a water efficient method of irrigation around our world. A lover of soil health and a big thinker about the way in which humans interact, or lack interaction with nature, was part of what he taught his students. “Detachment has bred ignorance and out of ignorance comes the delusion that our civilisation has risen above nature and has set itself free of its constraints.” He liked to illustrate points using language derivations, “… the Latin name for man, homo, derived from humus, the stuff of life in the soil.”

Hillel traveled to the U.S. for high school, undergraduate, and master’s degrees and then returned to Israel to work for the Agriculture Ministry in 1951. He earned his PhD in soil physics and ecology at the Hebrew University in 1957.

His concept of micro-irrigation was embraced by the FAO of the United Nations, which then helped teach the system to many regions of the world, including the Middle East.

As he accepted the prize, Hillel said, “The task of improving the sustainable management of the earth’s finite and vulnerable soil, water and energy resources for the benefit of humanity while sustaining the natural biotic community and its overall environmental integrity is an ongoing and increasingly urgent challenge.”

Now days Hillel splits his time between Israel and New York and is a senior research scientist at the NASA Goddard Institute for Space Studies at the Columbia University Earth Institute in New York. He’s focusing on global climate change, deforestation and land degradation.

4. PBS NewsHour Covers the Changing World of Farming in Japan

Japan imports 60 percent of its food, its farming population is aged, the values of the youth are changing, and its ministry is questioning production methods used there. It would make more sense to import the food that they need from more efficient world agricultural producers but they worry about their national food security. (9 minutes)

5. Greenhorns: 50 Dispatches from the New Farmers’ Movement

I found myself seated next to a most pleasant young man the other evening at an eat-local dinner. He said he was from Iowa and never dreamed he’d choose to do what he’s doing now following his escape from farm country and a college degree from the West Coast. He is an intern on an organic farm in Boulder County and dreams of a life as a farmer. He and his East Coast girl friend are trying to pick a place to set up. He realizes that they need a place with a strong market that isn’t already over-run with competition. He asked me to feature the Greenhorns book on my site, so here it is, and best of luck to you, Jeff, as you venture out. May the force be with you in the way of a changing Ag policy in America that supports what you and the rest of the greenhorns are doing.

Here’s a Greenhorn book review by Whitney Scott:

Essays on the spirituality and physicality of farming; the skill-building and life lessons accompanying the increased connection to the earth; and improved self-sufficiency define the Greenhorn movement. Fleming, founder and director of this group promoting young farmers, joins other Greenhorns and biodynamic farm enthusiasts in gathering writings on farming as an expression of patriotism and hope, addressing local food surety and self-reliance advocates, and farmers new and established, all connected in a reconstitution of a local, resilient, and delicious food system. Financing, tools, and community are major categories. Draft-powered farmer Alyssa Jumars writes that she’s never felt so alive as behind the great ass of a draft horse, and Jon Piana praises community effort turning a weeks-long harvest into an hour’s labor. Charming line drawings reinforce the anthology’s texts, supplemented by a far-ranging list of resources. Readers will also be interested in the documentary film The Greenhorns.

One thought on “Hot 5: Corn Production. Nebraska GDP. Dr. Daniel Hillel. Farming in Japan. Greenhorns.

  1. K.M. Post author

    Note to any potential commenters. It appears there’s some kind of glitch right now making comments disappear. Hopefully this will be fixed soon.

    RJS reported this to me & sent his comment by Email:

    did a few quick searches & couldnt find anything specific that would account for that nebraska anomaly, but a few things come to mind…this is year over year growth, so if nebraska had relatively good years during the depth of the recession, they may be growing relatively less at this point – ie, look at these fast growers: michigan, which was once down over 10%, or california, who’s underemployment rate is still over 11% – both of them are better than last year but they’re still virtual basket cases…the BEA release says state GDP is computed the same way as national; so nominally, 70 to 72% of US GDP is PCE (personal consumption expenditures), and most quarters i’ve reviewed national numbers the increase in investment (equipment, software & reral estate) is negated by decreases in state & local spending and net trade (exports-imports; negative for the US as a whole) so PCE ends up carrying 90% or more of the load…
    here’s your statistical details, if you want to dig any deeper


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