Top 10 Ag Stories of 2019: 10, 9, 8
Growth in Hemp; African Swine Fever Impact; Farm Stress
OMAHA (DTN) -- Each year, DTN publishes our choices for the top 10 ag news stories of the year, as selected by DTN analysts, editors and reporters. On Dec. 24, we looked at some of the runners-up for this year. Thursday we begin the countdown with No. 10 being the growth in hemp and how the country ended up with a glut of the crop; No. 9 looking at the impact of African swine fever in Asian trade, especially with China killing half of its herd; and No. 8 being how farm stress rose this year from various factors, as well as the discussion about how to deal with stress and mental health issues.
No. 10: Hemp Takes Off in 2019
DTN's No. 10 top ag story of 2019 was the growth of hemp. With the growth of products tied to CBD oil, farmers became attracted to the kinds of profits that hemp could generate. Acreage doubled in 2019, even though USDA did not finish the rules for growing hemp until late in the year. More farmers are expected to grow hemp in 2020 with crop insurance offered and fewer restrictions on growing the crop.
By Chris Clayton
DTN Ag Policy Editor
OMAHA (DTN) -- The horse was out of the barn and galloping away by the time USDA came out in October with its rule for growing hemp.
Some states took it upon themselves to quickly draft rules and allow farmers to grow hemp after Congress removed the crop from federal restrictions in the 2018 farm bill.
As Congress passed the farm bill, the market for cannabidiol (CBD) products exploded. Oils, pills, salves and food products containing CBD oil are now everywhere, even though FDA has only approved one CBD product on the market used for children with epilepsy. In November, FDA cautioned 15 companies, informing every business they cannot advertise CBD product as a treatment for a disease, a dietary supplement or a food product for people or animals. FDA then came out with a warning for consumers about what they don't know about CBD so far. https://bit.ly/…
Yet CBD is now the big market for hemp in the U.S. with sales at just under $2 billion over the past year. At least one forecast shows sales could top $20 billion in less than a decade, according to the Colorado firm BDS Analytics. It is the CBD market that is generating revenue for at least some farmers of $50,000 an acre or more to produce CBD oil in their plants.
Farmers are attracted to the prospect of profits that hemp can deliver. Nationally, hemp acreage in 2019 was projected at 511,442 acres, with 16,877 grower licenses across 34 states; the statistics were in the "U.S. Hemp Report" put together by the organization Vote Hemp. Roughly, a little less than half those acres, around 230,000 acres, were actually planted.
Hemp looks just like its cousin, marijuana, but hemp has low levels of the chemical Delta-9 tetrahydrocannabinol (THC), which must be limited to below 0.3% on a dry weight basis under the farm bill. USDA will allow a little latitude, but a test above 0.5% THC will lead to a violation requiring the crop to be destroyed.
Those connections to marijuana have caused some nervousness in the financial services industries. Merchant service companies such as PayPal closed accounts for hemp farmers early in 2019 and froze their accounts. After more than a year of uncertainty, federal and state regulators in early December agreed to make it easier for banks to do business with hemp farmers, processors and CBD companies. Banks also back a bill that passed the House of Representatives last fall that would offer banks some safe harbor and reduce some of the red tape.
Under USDA's rules, diversified farmers who grow hemp will be able to buy whole farm revenue protection to cover the crop starting in the 2020 crop year. Farmers will also be eligible to buy Noninsured Crop Disaster Assistance Program (NAP) policies for hemp.
To use USDA programs for hemp, farmers will need licenses through their states or tribe to grow the crop and will be required to file acreage reports at local Farm Service Agency offices with details on the location of those hemp crops. USDA also wants to know the intended use for the hemp in those reports, whether it's for fiber, grain, seed or CBD products.
USDA will require testing by labs registered with the U.S. Drug Enforcement Agency. Sampling will be one within 15 days before harvest by a USDA-approved sampling agent, or a federal or state law-enforcement agent. USDA will provide details for sampling, including how to collect a statistically valid sample from a field. USDA will approve state plans with slightly different sampling protocols if officials think they will create comparable testing results.
At least a dozen states enacted legislation in 2019, meaning their farmers will basically get their first shot at growing hemp in 2020. Just four states right now have no legislation allowing hemp production: Idaho, Mississippi, New Hampshire and South Dakota.
Chris Clayton can be reached at Chris.Clayton@dtn.com
Follow him on Twitter @ChrisClaytonDTN
No. 9: African Swine Fever Shifts Global Pork Exports
DTN's No. 9 top ag story of 2019 was African swine fever's impact on China leading to a shift in global pork exports. ASF helped boost U.S. pork sales to China despite high tariffs. China eventually even announced it would drop retaliatory tariffs against U.S. pork in a bid to spur more imports. Globally, several major competitors also sold large volumes of pork to China in 2019. The trend is expected to continue in 2020.
By Chris Clayton
DTN Ag Policy Editor
OMAHA (DTN) -- African swine fever in China proved to be a major force globally in shifting protein sales in 2019, and it will continue to influence global meat exports throughout 2020.
China's pork herd, the largest in the world, was projected by analysts at Rabobank to shrink by more than half by the end of 2019, leading to roughly a 25% decline in pork production throughout the year.
Early in 2019, retail pork was cheap as the government pushed farmers to aggressively slaughter animals, but by early summer, Chinese consumers had overtaken both fresh and frozen pork supplies, causing a push for imports. Despite tariffs as high as 72% on U.S. pork, sales of pork and variety meats to China were approaching $1 billion through October, up roughly 34% from a year earlier. Sales in volume were 55% higher.
In a sign of thaws in the trade dispute with the U.S., China announced in early December it would drop tariffs on U.S. pork and soybeans, a move suspected because retail pork prices in China continue to rise.
The National Pork Producers Council highlighted that if China dropped all tariffs, including the standard 12% duty, the value of the U.S. pork industry would more than double over the next decade, going from $20 billion to $48 billion in pork production.
The U.S. wasn't the only pork exporter to take advantage of the demand. Pork exporters in Europe also saw record sales to China. Denmark Crown, a top pork exporter, opened a new pork plant in Shanghai to sell products for Chinese retailer Alibaba.
The losses in China's pork herd led to a decline in soybean imports as well. USDA puts China's soybean imports for the 2019-20 crop year at 85 million metric tons (3.12 billion bushels) down from 94.1 mmt (3.46 bb) in the 2017-18 crop year. Rabobank anticipates China's animal feed imports would fall by 17% by the end of 2019, but rebound in 2020 as Chinese farmers switch to raising more poultry and aquaculture.
The threat of African swine fever to the North American livestock herd looms large as the disease has spread throughout both Asia and Europe. USDA raised concerns multiple times, noting ASF does not affect humans, but the disease is highly contagious and deadly among both domestic and feral swine. The U.S. tightened import controls, including using dogs to detect pork entering the country illegally. Last spring, roughly 1 million pounds of pork from China were seized at port.
Greg Ibach, undersecretary of marketing and regulatory programs for USDA, told members of Congress in May that USDA has stepped up biosecurity and import control efforts for African swine fever, but Ibach also emphasized ASF is a difficult disease to control once it arrives.
"African swine fever has proven to be a tough disease to find a cure for or a vaccine for," Ibach told members of the House Agriculture Committee at the time.
Chris Clayton can be reached at Chris.Clayton@dtn.com
Follow him on Twitter @ChrisClaytonDTN
No. 8: Stress Takes a Toll on Farmers, Ranchers
DTN's No. 8 top ag story of 2019 was the farm stress toll on farmers and ranchers, caused by a number of factors ranging from weather challenges to international trade wars. Farmers endured a long season of uncertainty that has advocates calling for more attention and resources to be devoted to mental health.
By Pamela Smith
Crops Technology Editor
Adverse weather combined with a flurry of trade and market scenarios to create a perfect storm of frustration for many of the nation's farmers in 2019. While agriculture and farmers are no strangers to adversity, the seasonal strife was long-lived and widespread.
This year's challenging weather included powerful late-winter blizzards, widespread devastating floods, and seemingly endless rains delaying crop planting and harvest.
In April, Associate Professor Christina Chasek, from the Department of Counseling and School Psychology at the University of Nebraska-Kearney (UNK), said those who survived a flood need to address their mental health, as well as physical health.
She said people often have feelings of grief and loss after a flood. Common reactions can include disbelief, shock, fear, no control over events and a whole list of other reactions.
"Natural disasters pile onto everything else in agriculture," Chasek said. "This causes a lot of stress and people don't take care of themselves."
In a spring webinar titled "Wellness in Tough Times" by University of Nebraska-Lincoln (UNL) Extension Educators Brandy VanDeWalle and Glennis McClure, the speakers noted that continuous stress is not good for the human body and can affect both physical and emotional well-being. Agricultural-related stress can be caused by many different factors and its symptoms can be manifested in several ways.
McClure said many items can cause stress in agriculture. Weather challenges, crop and livestock production risks, machinery breakdowns, debt loads, volatile markets, multiple-generation farms and ranches, long days with lack of sleep and government regulations can all contribute to ag-related stress.
"Two or more of these stresses can cause problems," McClure said. "And we saw some pretty major weather stress earlier this spring."
Glen Newcomer remembers the very day he realized the bulk of his corn and soybean crop would not get planted. "We kept saying all spring that we'd get it in the ground -- we always had," he recalled.
However, frequent rain events meant Newcomer, who farms near Bryan, Ohio, was only able to plant 30 acres of corn in May. A total of three days in June were fit to plant soybeans. Ultimately, about 80% of his farm was idled under prevented planting provisions, and the challenge then became finding ways to stay positive and productive.
Kyle Samp, who farms near Cairo, Missouri, experienced a different kind of agronomic handwringing. His fields got planted -- some of them three times.
"I've farmed for 16 years -- 10 of those where farming has been my sole source of my income. This was the hardest year I've experienced" said Samp. "We plan all winter for spring. We know it isn't always going to go exactly as planned, but things just went sideways all season, and I started second-guessing every decision."
Like a father watching over acres of teenagers, the remainder of the growing season became filled with worries and uncertainty as to if or how many of his planted children might make the curfew of harvest.
Newcomer threw himself into getting fields ready for 2020, volunteering more and relishing family time. He took a long road trip and found perspective. Crop insurance provided an important financial safety net that wasn't there when he started farming in the tumultuous 1980s.
Yields turned out surprisingly good for Samp, especially soybeans. However, the rollercoaster year sucked some joy out of farming, he admitted. "I am lucky to have strong family support. My wife is a rock and I leaned hard on her positivity this year," he said.
Every situation varies and some enterprises, such as dairy, have also been challenged. Holding onto family legacy and transition between generations adds to the unique stress farmers face.
The silver lining to the stress doled out in 2019 might be that there was more attention drawn to the overall topic of farmer mental health, said Lesley Rae Kelly, a Saskatchewan, Canada, farmer and co-founder of The Do More Agriculture Foundation. The group encourages others in the farming community to speak openly about mental health and trains responders to counsel farmers and farm families.
It's time to remove the stigma that mental health is a negative thing, Kelly said. "It is part of each and every one of us and is part of being a healthy individual," she said.
Stress and farming go hand in hand, even in good years. Understanding what stress is, finding ways to manage it and reaching for help when we become overwhelmed are important factors in overall wellbeing, she said.
For more on dealing with stress, see https://www.dtnpf.com/… as well as https://www.dtnpf.com/….
DTN Staff Reporter Russ Quinn contributed to this article.
Pamela Smith can be reached at email@example.com
Follow her on Twitter @PamSmithDTN
Editor's Note: You can find Numbers 7, 6 and 5 in DTN's top 10 list on Dec. 27.
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