Risk and Profit Conference

2022 Breakout Sessions [Topics marked (**) are also online from August 22-26] 

In-Person Schedule  | Online Schedule

**1. A Heterodox (Not Unorthodox) Perspective on the Unfolding Economic Environment

Vincent Amanor-Boadu

The economy is teetering on the brink of something we have seen, but have not seen before. Labor market is tight in the midst of a rising inflation and public policymakers and business leaders are trying to use tools they are familiar with to address a problem they have not seen before. The good news is that heterodox economics has a radical solution to situations like this – praxeology. People always do what is in their best interest, even if they miscalculate what their best interest is. This conversation seeks to provoke a dialogue about the role of government when the unfamiliar happens, drawing from lessons learned (or unlearned) from previous unfamiliar situations and how actions contributed to often unintended outcomes.

**2. Ukraine Update

Antonina Broyaka

The Russian aggression in Ukraine has had a great impact on the economy of Ukraine, neighboring countries and the world, especially in the grain markets. The significant reduction of the grain harvest in Ukraine and the limitation of its export potential raises very serious questions for the world about food security and food inflation. Despite all negative background, in 2021/22MY, Ukraine produced a record 86 million metric tons (MMT) of grain and legumes, including 32.2 MMT of wheat. However, the inability to ship all planned grain exports resulted in formation of high carry-over stocks at 17.3 MMT, up three times compare to previous year. There are 480 thousand tons of grains and vegetable oils loaded onto ships that are still in the ports of Pivdennyi, Odesa and Chornomorsk. About 1 million tons of grain is stored at port terminals and warehouses. Unblocking Black Sea ports can bring Ukraine up to $1 billion in additional export revenue per month and add 5% to GDP. In addition, global food inflation will slow down and the threat of famine in import-dependent countries will decrease.

**3. Agricultural Finance Situation

Allen Featherstone

The current agricultural finance situation shows that net farm income from 2021 marked the 6^th increase in a row.  Information will be provided on past, recent, and future developments regarding the agricultural finance situation with information on the income situation, the financial health of farm operations, and land market trends throughout the U.S.

4. Kansas Net Farm Income Projections for 2022/2023

Gregg Ibendahl

2021 saw a dramatic rise in both grain and input prices. This has added to the uncertainty that farmers face. Accurate predictions about net farm income could help many with their long term plans and help guide machinery and other input purchases. This session will attempt to predict Kansas net farm income for 2022 and 2023. KFMA farm data from the last several years is used to set a baseline and then projections about yields and prices are used to estimate revenue while projections about major expenses are used to estimate farm expenses. In addition to the overall net farm income projections, this presentation will also analyze expected changes to fertilizer and fuel and also provide more general guidance about other farm expenses. 

5. Key International Grain Market Factors in 2022/2023

Guy Allen, Dan O'Brien

World grain markets are now characterized by tight and tightening global supply-demand balances, high and volatile international grain prices, and vulnerability to geopolitical conflicts and crop production shortfalls. In this session we will examine the current “squeeze” on global grain stocks and the resulting high price scenario that now exists.  This discussion will examine both “Total World” and “World-Less-China” perspectives for wheat, coarse grains (corn, sorghum, etc.) and oilseeds (soybeans, canola / rapeseed, and sunflowers). 

We also discuss the countries that are most vulnerable to grain / food / energy shortages and associated political unrest in the coming year.  Key 2023 grain market-related issues will be discussed, concerning a) China (i.e., domestic political risk, grain supply-demand uncertainty, potential trade flow disruptions), b) South America (i.e., inflation and economic risks in Brazil and Argentina, as well as availability of fertilizer for crop production in 2023), and c) the Ukraine-Russia conflict (i.e., international grain market supply-demand and trade flow implications & risks). 

Finally, the impact on global and domestic U.S. grain markets from dynamic events in world financial markets will be examined.  These include 1) the changing value of the U.S. Dollar and associated foreign exchange rates, 2) trends in global and U.S. inflation rates, and 3) U.S. monetary policy actions in response to these widespread financial problems.

**6. Kansas Land Values and Trends

Robin Reid

Kansas land values have been rapidly increasing over the past two years as commodity prices have increased, government payments have provided increased capital, interest rates have been low, and non-ag. investors have taken an interest in farm ground.  Most areas of Kansas have currently surpassed the peak value of farm ground seen in 2014 (before the downturn in the farm economy), setting new records in land value. This session will look at trends in ag. land value over recent years and discuss what we are seeing in ag. land sales for the first half of 2022.

7. Lending Trends for Kansas Farms, 2013-2020

Sylvanus Gaku, Jenny Ifft

In this session, we analyze trends in the number and type of lenders used by Kansas farms in the past decade. US and Kansas farms use credit from many lender types: input suppliers, implement dealers, commercial banks and the farm credit system, among others. Increasing sources of credit means more opportunity for agricultural producers and businesses but may also increase financial risk. However, the phenomenon of “multiple borrowing” is not well understood and is difficult to research due to data availability. Using novel lender classifications recently added to KFMA data, this presentation aims to provide an overview of the extent of multiple borrowing in Kansas while achieving the following objectives: (1) identify characteristics of farms engaged in multiple borrowing; (2) provide insights on market share of lender types; and (3) provide an overview of multiple borrowing behavior in high- and low-income periods. The presentation will conclude with implications for potential continued inflation and a general economic downturn.

**8. Planning for the Future of the Farm

Ashlee Westerhold

Introducing the Office of Farm and Ranch Transition. This session discusses the importance of succession planning and how to get started. We will discuss structured family meetings, successful transition plans, and how the Office is here to support Kansas farmers and ranchers in their efforts.

9. Insights from the Meat Demand Monitor Dashboard

Justin Bina, Glynn Tonsor

The Meat Demand Monitor is a monthly, national survey focused on domestic meat demand with separate consideration of retail and food service decision making. We create a publicly available dashboard to communicate data obtained from the survey and to showcase state-level comparisons.

**10. Beef and Pork Marketing Margins and Their Implications

Jaime Luke, Glynn Tonsor

Marketing margins and “farmer’s-share-of-the-retail-dollar” statistics have been widely-cited in discussions about the status of the U.S. meat-livestock sector, but these measures may be misleading and incorrect. By utilizing scanner-based transaction data from grocery stores across the country, we can establish a different, perhaps more accurate, view of what consumers are truly paying for meat by accounting for sales and promotions that are typically not captured in traditional retail price series. This presentation will walk through how using scanner-based data changes marketing margins and what that could mean for the meat-livestock industry going forward.

**11. Cow-Calf Herd Size: How Has the Industry Responded to Elevated Uncertainty?

Amber Oerly, Glynn Tonsor

The beef cow herd in the United States has been in a state of contraction since 2020 (USDA NASS, 2022). Changes in the beef industry, such as costs, structure, technology, producer and operation demographics, climate events, and barriers to entry and asset fixity, impact cow-calf producer herd expansion and contraction decisions. This presentation will address what factors impact herd expansion and contraction decisions and what the future of the beef cow herd will look like across the United States, given increased economic, environmental, and social uncertainty in the industry.

12. Drought Management for Cattle Producers: Forage Prices and the Role of Insurance

Cordon Rowley, Jenny Ifft

Cattle producers take many actions to manage drought, including maintaining forage inventories, increasing culling rates, and formal insurance products. In this presentation, we will show trends in hay prices and weather. We will then discuss the financial impacts of different drought management strategies and the potential role of formal insurance and FSA programs. 

**13. Using Margin Protection Insurance to Manage High Input Costs in 2023: Considerations for Kansas Producers

Jenny Ifft

Margin Protection insurance is available for Kansas soybean and corn farmers and protects against an unexpected decline in the different between county level revenue and costs, including fertilizer, diesel, and interest rates. This is a relatively complicated product that hasn't been widely used in Kansas, but producers may be interested this year due to high input costs and the ability to set a revenue guarantee for 2023 based on current futures prices.  After a brief description of MP, this presentation will cover (1) potential expected revenue based on current futures, (2) how well MP input cost estimates match KS corn and soybean input costs and (3) how input cost increases could trigger an indemnity under MP.

**14. Pasture, Rangeland, and Forage Insurance and Conservation Reserve Program

Jisang Yu

In this presentation, we discuss two US farm programs that are relevant to pastureland, the Conservation Reserve Program (CRP) and Pasture, Rainfall, and Forage Rainfall Index Insurance (PRF-RI). We first illustrate these two programs in terms of the program structure, enrollment eligibility, and process. We then analyze the competition between these two programs using county-level enrollment and availability data. We find that the introduction of PRF-RI reduces the enrollment in CRP. This interaction is potentially forcing environmentally sensitive farmland back into production.

15. Spatial and Temporal Patterns of Returns to US Field Crop Production

Jiyeon Kim, Jisang Yu

The economic conditions of US field crop production has experienced various changes in market forces and policy changes. For example, corn acreage has increased in response to growth in biofuel demand and soybean acreage has also risen due to international demand. In this presentation, we will discuss spatial and temporal patterns of returns to US field crop production. We first show changes in the major field crop production, such as crop yields, planted acres, costs, price, and returns at the county level from 1980 to 2020. We then discuss the over-time changes and spatial variations in the average returns and the variability of the returns. 

**16. Fall Income Tax Management and Planning

Mark Dikeman

With both commodity and input prices at high levels, year-end tax planning will be important for agricultural producers in 2022.  This presentation will provide an introduction to some of the tools and techniques that farms and ranches have at their disposal when it comes to income tax planning and management.

17. A Dynamic Pro-Forma Tool for Kansas Farmer Cooperatives

Gerald Mashange, Brian Briggeman

The Arthur Capper Cooperative Center has developed a dynamic pro-forma tool for farmer cooperatives. The purpose of the tool is to provide users a high degree of control in order to report the future outlook of the cooperative that is in line with management’s expectations.

18. Building Strong Relationships...Producing Excellence -- A History of the Kansas Farm Management Association at Kansas State University

Kevin Herbel

Since 1931 the farm families of Kansas and the agriculture industry have benefited from the education and service delivered by the Department of Agricultural Economics at Kansas State University through the Kansas Farm Management Association (KFMA) program. This session will take a look at that history: explaining how the KFMA program began; exploring some of the successful, difficult and interesting events during the nine decades of program history; and, reviewing some of the data that provides a snapshot of a 90-year history of Kansas agriculture. Throughout the program’s history and continuing today, the KFMA motto, “Building Strong Relationships…Producing Excellence,” is achieved as KFMA Economists work to provide farm-specific financial management information to KFMA members through one-on-one advising relationships, and as an extensive database is made available for use in Agricultural Economics research, teaching and extension programs.

19. Hiring H2A Workers

Jonie James, LaVell Winsor

This session will be an introduction to resources needed when considering hiring H-2A workers. Securing H-2A employees is a complicated process involving many steps and considerations. Due to the complexities, many farmers will have an agency help them navigate the process. During this session, an agency representative will briefly walk through the steps involved in hiring an H-2A employee. Then a family farm will share their experiences of hosting foreign employees, what they learned, what they wished they would have known, and other tips to making an H-2A experience successful.