Risk and Profit Conference
See 2017 presentations HERE.
An annual conference hosted by the Department of Agricultural Economics that provides an opportunity for key agricultural decision makers to interact with each other and with faculty on important topics in agriculture.
Questions? Rich Llewelyn at firstname.lastname@example.org(link sends e-mail) or 785.532.1504.
August 16 - 17, 2018
K-State Alumni Center
100 Alumni Center 1720 Anderson AveManhattan , KS 66506
Detailed schedule: HERE.
THURSDAY, AUGUST 17, 2017
10:30 am REGISTRATION
11:30 am – 12:15 pm LUNCH
12:15 pm – 1:15 pm GENERAL SESSION
Livestock Market Outlook
Glynn Tonsor, Kansas State University
1:30 pm – 2:20 pm BREAKOUT SESSION I
2:30 pm – 3:20 pm BREAKOUT SESSION II
3:30 pm – 4:20 pm BREAKOUT SESSION III
4:30 pm – 5:20 pm BREAKOUT SESSION IV
5:20 pm – 6:00 pm Social & Cash Bar
6:00 pm – 6:45 pm PRIME-RIB DINNER
6:45 pm – 8:00 pm GENERAL SESSION
A Conversation With a Kansas Producer
Bill Came, Came Farms Inc.
FRIDAY, AUGUST 18, 2017
7:30 am – 8:00 am ROLLS and JUICE
8:00 am – 9:30 am GENERAL SESSION
Matt Erickson, Chief Economist
U.S Senate Agriculture Committee
(TENTATIVE due to Senate schedule)
9:40 am – 10:30 am BREAKOUT SESSION V
10:40 am – 11:30 am BREAKOUT SESSION VI
11:40 am – 12:30 pm BREAKOUT SESSION VII
12:45 pm – 1:30 pm LUNCH
1:30 pm – 2:30 pm GENERAL SESSION
Grain Market Situation and Outlook
Dan O’Brien, Kansas State University
2:30 pm – 2:45 pm FINAL QUESTIONS and WRAP-UP
Bill Came is the featured producer for the "Conversation with a Kansas Farmer" on Thursday night. Bill is President of Came Farms, Inc., which he owns and operates with his wife Laurie, Joyce Came (mom) and Darcy Bradley (sister). They are a no-till farm northwest of Salina and farm in Saline and Ottawa counties. Their crop rotation is wheat, double-crop milo or soybeans, milo or corn, soybeans and then back to wheat. They also have a cow-calf operation. After high school, Bill attended Kansas State, majoring in Agricultural Economics for one year before returning to the family farm in 1991. In 2010 he completed the MAST program.
Matt Erickson is the Chief Economist for U.S. Senate Agriculture Committee. He previously worked as an Economist for the American Farm Bureau Federation. At American Farm Bureau, Matt specialized in analyzing domestic policy issues ranging from big data, budget and Farm Bill policy, with a focus in energy markets. He also served in USDA’s Rural Development office during the Bush Administration and worked as a consultant with Elanco Animal Health. In addition, Matt has had agricultural policy experiences at the White House National Economic Council during the Bush Administration and with former Senator Richard G. Lugar of Indiana. Erickson was born and raised on his family’s farm of five generations in Brookston, Indiana. He graduated from Purdue University with a Bachelor of Science and a Master of Science in Agricultural Economics.
NOTE: Matt Erickson is tentative due to the Senate schedule.
1. Kansas Land Values and Rental Rates - Mykel Taylor
With a down farm economy and lingering uncertainty about future profitability, the land purchase and rental markets are in a state of flux. We will look at current trends in land values and where they are headed, followed by a discussion of the strength of the rental market for ag land in Kansas.
2. Benchmarking Farm Financials During Challenging Times - Robin Reid
In these times of low agricultural profitability, knowing your financial ratios and how they compare to similar farms in Kansas can shed light on strengths and weaknesses in the farm business. Robin Reid presents a tool to benchmark 11 common farm financial ratios against different subsets of farms in the Kansas Farm Management Association. Both 10-year averages and recent financial ratios (2016) are used to reveal a distribution of where a farm falls compared to its peers. Mark Dikeman presents a decision tree that points to what might be contributing to vulnerable financial ratios and how improvements can be made.
3. Interest Rate Outlook - Brian Briggeman
With an improving U.S. economy, many are expecting the Federal Open Market Committee to continue to raise interests. However, when will it happen? Will it be a rapid rise? How might higher rates impact U.S. agriculture? In this presentation, Dr. Briggeman will discuss the current and future path of interest rates, and the ramifications of interest rates on agriculture.
4. Replacing Farm Equipment - Gregg Ibendahl
Machinery costs are one of the top expenses for Kansas farmers and typically represent more than one third of total costs per crop acre. In this session, we examine machinery replacement strategies for those farms who own their own farm equipment. In particular, we examine the effects on net farm income and cash flow from these various strategies. Most farms practice the strategy of buying more equipment during good years but then not purchasing as much during low profitability years. We compare this choice to others to see if this has been the best approach for farmers. During times of low farm profitability, when lenders may be reluctant to lend, devising a strategy that provides adequate cash flow may help farmers survive until profitability improves.
5. Farm Diversification as an Adaptive Capability: Examining the Resilience of Kansas Farms - Michael Lindbloom and Aleksan Shanoyan
The purpose of this study is to examine the impact of diversification on farm resilience. The analysis utilizes an innovative system resilience approach in combination with panel database on Kansas farms. Specifically, resilience index values were computed for more than 1400 farms during three distinct periods of economic and agro-ecological shocks. Additionally, a unique diversification index was computed at the individual farm level accounting for variation in crop selections across acres and across years. The results indicate that the farm size and the level of diversification play an important role in farm's ability to withstand and recover from unexpected economic and agro-ecological shocks.
6. Farm Profitability Persistence and Key Characteristics - Jayce Stabel and Terry Griffin
Farm-level data from the Kansas Farm Management Association (KFMA) were evaluated to determine the probability of farms transitioning between financial vulnerability categories. Although it is intuitive that farms can go from one profitability level to a higher (or lower) level, it was not clear how often farms transitioned between these levels. We present the probabilities and offer insights into what factors contributed to persisting within the current category or moving to another.
7. Farm Accounting with QuickBooks: A Hands-On Workshop - Mark Dikeman
This session will provide participants a hands-on introduction to QuickBooks as a farm business accounting program. Participants will be provided a printed manual which will be used as a guide to work with a sample farm. In the sample farm, participants will add bank accounts and liabilities, enter checks, make deposits, work with bills (accounts payable), and create and manage invoices (accounts receivable). Computers with QuickBooks installed will be available for participants to use during the workshop. This session will be four hours in length and is limited to 10 participants.
8. When You Retire From Farming/Ranching and Transition From Operator to Landlord, Are You Still a Farmer/Rancher For Income And Estate Tax Purposes? - Bryan Manny
Production agriculture like any business has a life cycle where the owner/operator decreases their active involvement in the farming/ranching operation. Besides the daily work routine, other issues could and will change business decisions depending on how the remaining farming/ranching assets are conducted. Most of these issues will pertain to land ownership, but other issues would involve the type of business entity, crop share lease vs. cash lease, material vs. nonmaterial participation in the remaining assets, family or nonfamily if farmland is rented out and etc. The outcomes of these changes could be minor in nature or it can be major in the overall decision objective. Overall changes will affect Income Tax regulations (timing of deductions and losses) along with Estate Tax laws (tax basis and special use value) and timing of receiving Social Security Benefits and Retirement Income Distributions. This presentation will highlight some of the topics for general knowledge overview.
9. Non-Convergence and Variable Storage Rates in Futures Markets - Dan O’Brien, Beth Yeager, Art Barnaby
In this session, an explanation will be given of how this situation of non-convergence between HRW cash and futures developed, how the new VSR on Kansas HRW wheat will work, and what market impacts may occur as a result of these futures contract changes. In particular, there will be a focus on how Kansas HRW wheat futures spreads between upfront and deferred futures contracts may be affected, and what Kansas wheat farmers and the wheat industry may do to effectively manage their wheat price risk under this new futures contract specification.
10. Bluestem Pasture Survey - Leah Tsoodle and Xianghong Li
The ALUSC conducted the 2017 Bluestem Pasture Survey to collect information about pasture leases in the 14 Kansas Bluestem counties. The presentation summarizes the 2017 Bluestem pasture report compiled from the survey responses on lease rates and fence building costs.
11. An Updated Look at Live Cattle Price Discovery - Brian Coffey
Over the past several years, methods of live cattle marketing and pricing have changed. One notable shift has been that, at the national level, the proportion of all live cattle sold on a dressed basis has steadily increased. At the same time the proportion of negotiated purchases made on a dressed basis has declined. It is unclear how these two trends—the former indicating an increased aggregate importance of dressed marketing and the latter a smaller influence of dressed marketings on reported prices—interact to influence live price discovery in cash and futures markets. We will map out these changes at the national level and in Kansas and Nebraska to give a picture of how live cattle marketing has changed over time. After that, we show results from statistical analysis that measures the relative importance of live and dressed negotiated prices in the live cattle price discovery process.
12. Managing Change - Deborah Kohl
To everything there is a season, but change is constant. Recognizing the need for change and responding to it well is imperative in managing risk. This hands-on session will examine current forces of change in agriculture and agribusiness and the Change Curve. Participants will evaluate a current or anticipated change in their organization/operation and sketch out a road map to effectively manage risks associated with leading others through change.
13. Ethanol and Biodiesel Market and Profitability Prospects - Dan O’Brien
Ethanol and biodiesel plants have shown periods of profitability during 2017 – following from low input costs for feedgrains, and soybean oil, and moderate strength in selling prices for ethanol and biodiesel. From a Kansas agricultural perspective, this session will particularly focus on how feedgrain usage on one hand, and distillers’ grain availability on the other have affected state’s livestock feed markets. Future prospects for the Renewable Fuels Standard (RFS), transition from E-10 to E-15 fuel blends, and the performance and prospects for ethanol and DDGS imports and exports will be examined. The session will conclude with a discussion of U.S. energy policy directions and their likely impacts on the ethanol industry and U.S. feedgrain use in the future.
14. Margin Protection Insurance - Monte Vandeveer and Art Barnaby
A new form of crop insurance coverage will be available in Kansas for the 2018 corn and soybean crops. Margin Protection coverage insures against an unexpected decline in a producer’s margin, defined as crop revenue (= price x yield) – operating costs. MP coverage is an area-based plan, using county yields. This session will discuss the nuts and bolts of how MP coverage works and how it might fit into a producer’s risk management plans.
15. Administration’s Proposed Cuts to Crop Insurance - Mykel Taylor and Art Barnaby
The next Farm Bill is already in the works and many impactful proposals are coming to the negotiating table. The session will feature a quick look at some of those proposals and what they could mean for Kansas farmers and ranchers. We will focus specifically on crop insurance limits and changes to other relevant programs.
16. How Crop Insurance Affects Farm Business Survivability - Dustin Pendell, Jisang Yu, Youngjune Kim
This article identifies if, and to what degree, crop insurance payments have influenced farm business survival. The results suggest the farms that purchased crop insurance are prone to survive about seven years longer than farms that did not purchase crop insurance. Also, the results support our hypothesis that crop insurance is positively associated with farm business survivability by decreasing the rate of farm failure by 1.23%.
17. Basis Risk and Effectiveness of Rainfall Index Insurance for Pasture, Rangeland, and Forage – Jisang Yu, Monte Vandeveer, Jerry Volesky
Pasture, Rangeland, and Forage (PRF-RI) insurance coverage is a relatively new insurance plan for grazing and haying lands which uses a rainfall index for a large “grid” area as the basis for coverage. How well does the grid rainfall outcome track with a producer’s own forage output? The potential for difference results in “basis risk,” and this study takes an initial look at it for a set of locations. Using historical yield and rainfall data from two university-managed ranches, we measure basis risk of PRF-RI and use the estimated results to evaluate the effectiveness of PRF-RI. Because our dataset has relatively large number of variables compared to the number of observations, we use a method to estimate the relationships between yields and precipitation and yields and PRF indices and provide estimates on the degree of the basis risk of PRF-RI. Our estimates suggest that the overall basis risk of PRF-RI is about 90% of total pasture yield variation and about 6.7% of the basis risk is due to the difference between actual precipitation and PRF indices.
18. A Booming Interest in Groundwater Conservation in Kansas—Why Now? - Bill Golden
The Ogallala Aquifer is significantly over-appropriated. The aquifer has declined in some areas more than 60% since predevelopment. Past efforts to slow the decline and insure the future economic viability of the region have been largely unsuccessful. More recently, interest in groundwater conservation has boomed in western Kansas. With the introduction and adoption of Local Enhanced Management Areas, Water Conservation Areas, and Water Technology Farms there appears to be a great deal of motivation toward sustaining the Ogallala Aquifer. The purpose of this presentation is to review the new developments and suggest a reason for it happening now.
19. Precision Agriculture Profitability - Terry Griffin
Questions regarding the profitability of precision agricultural technologies usually result in an ‘it depends’ scenario. Using Kansas Farm Management Association (KFMA) farm data, the adoption and impact of precision agricultural technologies are presented based on 535 farms.
Register online at: http://commerce.cashnet.com/KSUagecon.
Or download brochure and mail a check HERE.
By August 14, 2017
Two-day Fee: $200
Additional member: $180
One-day Fee: $125
Additional member: $110
(Discount available if paying by check)
After August 14, 2017
Two-day Fee $225
One-day Fee $150
Questions? Rich Llewelyn at email@example.com(link sends e-mail) or 785.532.1504.
To Manhattan, Kansas and the K-State Alumni Center (17th & Anderson):
From the east: I-70 to exit 313. North on Hwy 177 to Ft. Riley Blvd then west to 17th Street. North (right) on 17th to Anderson Ave.
From the west: I-70 to exit 303. North on Hwy K114/K18 (Ft. Riley Blvd) to 17th St. North (left) on 17th to Anderson.
From the north: Hwy 77 south to Seth Child Rd (Hwy 113). South on Seth Child to Anderson Ave. East (left) on Anderson to 17th St.
|Holiday Inn - Campus|
Manhattan, KS 66502
Conference Rate: $99.95 + tax / night
Single or Double
Rates valid August 15, 16, or 17, 2018
Cut-Off Date: July 30, 2018
Use Group Code: RIS
|Four Points, By Sheraton|
530 Richards Dr
Manhattan, KS 66502
800.4.CHOICE or 785.539.5311
Conference Rate: $81 + tax / night
Single or Double
Ask for K-State Risk and Profit Block.
Cut-Off Date: August 4, 2017
Parking is available in the parking garage, but costs $1.50 per hour. In other lots, permits are required to park on the Kansas State University campus from 7 am to 5 pm Monday through Friday. Limited parking is available at the Alumni Center without a permit. A parking permit is included in the registration fee, but does NOT include the parking garage.
Permits will be available 10:00–12:00 on Thursday, August 18 at the Alumni Center driveway and at the entrance to the parking lot west of the Old Stadium or at the registration table throughout the conference. You MUST obtain your conference parking permit before parking your vehicle on campus. Hang this permit on your rearview mirror, facing the front of your vehicle. This permit is not valid in metered lots.
Parking is permitted only in areas designated for parking
Parking is not permitted on campus streets or drives
Please observe HANDICAP, RESERVED and NO PARKING zones; these are TOW ZONES and violators will be towed.
Limited parking is available in the Alumni Parking. Be sure to get an Alumni Center parking tag from the registration desk.
More parking is available in the lot west of Old Stadium (across Denison Avenue), north of the Catholic Church, using the parking permit.