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Overview of Wisconsin and US Agricultural Economy: Insights and Trends

This presentation by Bruce L. Jones from the Renk Agribusiness Institute offers a comprehensive overview of the agricultural economy in Wisconsin and the broader US context. It covers key topics such as the financial status of Wisconsin agriculture, the diversification of dairy farm operations, critical farm bill issues, and agricultural enterprise performance. Additionally, it provides a long-term outlook from the USDA and examines farmland values across Wisconsin and neighboring states, highlighting trends in dairy and livestock production, as well as pricing dynamics for key crops like corn and soybeans.

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Overview of Wisconsin and US Agricultural Economy: Insights and Trends

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  1. An Overview of Wisconsin and US Agricultural EconomyBruce L. JonesDirector, Renk Agribusiness InstituteAugust 2013

  2. Outline for Presentation • Wisconsin Ag Financial Status • Diversification & Dairy Farm Performance • Farm Bill Issues • Ag Enterprise Performance • USDA Long Term Outlook • Farmland Values: Wisconsin and Neighboring States

  3. Dairy

  4. Livestock

  5. *Total production of beef and pork **Volume in million dozen and price in cents/dozen. See source for pricing points. Source: USDA, Livestock, Dairy and Poultry Outlook, December 2011 and December 2012.

  6. Corn and Soybeans

  7. * December Estimate ** December Forecast. Source: USDA, World Agricultural Supply and Demand Estimates.

  8. * December Estimate ** December Forecast. Source: USDA, World Agricultural Supply and Demand Estimates.

  9. Diversification and Dairy Farm Performance

  10. Sample Dairy Operations

  11. Hay price (PH) as a function of corn price (PC) • PH = 70.39 + 15.73 PC (6.65) • R2 = .9046

  12. Soybean price (PS) as a function of corn price (PC) • PS= 1.6299 + 1.9126 PC(14.18) • R2 = .9306

  13. Soybean Meal price (PSBM) as a function of soybean price (PS) • PSBM= 36.7135 + 27.917 PS (16.017) • R2 = .9379

  14. Cropping Assumptions

  15. Dairy Assumptions

  16. Assumed Market Conditions

  17. Results

  18. Farm Bill Issues

  19. Likely 2013 Farm Bill Subsidized crop insurance – Voluntary Reduced protections for dairy Dairy Security Act -- Senate Dairy Freedom Act -- House

  20. Dairy Security Act • Dairy Producer Margin Protection Plan • Voluntary • “Guarantees” producers $4/CWT Income over Feed Costs (IOFC) on 80% historic production • Producers can purchase higher IOFC protection • Administrative fee of up to $2500 • Requires participation in Dairy Market Stabilization Program – Supply Control

  21. Dairy Freedom Act • Voluntary • Margin insurance program where payments of higher premiums can increase IOFC per CWT guarantee from $4 to as much as $8

  22. Enterprise PerformanceUSDA-ERS ARMS

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