SERA35: Delta Region Farm Management and Agricultural Policy Working Group

(Multistate Research Coordinating Committee and Information Exchange Group)

Status: Active

SERA35: Delta Region Farm Management and Agricultural Policy Working Group

Duration: 10/01/2015 to 09/30/2020

Administrative Advisor(s):


NIFA Reps:


Statement of Issues and Justification

The lower Mississippi River Delta region of Arkansas, Louisiana and Mississippi, along with adjacent production regions in those states, comprise one of the largest and most diverse agricultural production areas in the southern region of the United States. Soybeans, rice and corn are the major agricultural row crops produced in the region, along with sizeable acreages of cotton, sorghum and wheat. Arkansas, Louisiana and Mississippi are ranked first, second and fifth in the United States in terms of rice acreage. In 2014, Arkansas harvested 1.48 million acres of rice, Louisiana harvested 458,000 acres and Mississippi harvested 190,000 acres. Arkansas was the largest producer of soybeans in the southern region with 3.21 million harvested acres. Harvested soybean acres in Mississippi was 2.20 million acres with 1.40 million acres in Louisiana. Total harvested acreage of corn in the three states exceeded 1.40 million acres in 2014. Total acreages of corn, rice and soybeans, along with cotton, sorghum, sugarcane and wheat, comprised over 12.8 million acres of row crop agricultural production in these three Delta Region states in 2014.

Commercial farming operations across the region share similar characteristics and challenges. Although some differences exist across the region, machinery complements and production cost structures are relatively similar for major crops produced by states in the region. In addition, farming operations across the region also face similar current challenges related to the long term economic viability of row crop agricultural production. Some of these challenges or issues include: (1) adoption of new production technologies to reduce per unit production costs, (2) optimal enterprise mix and farm size as production costs and commodity market opportunities change over time, (3) impact of rising fuel and fertilizer prices on farm profitability, and (4) the impact of changes in the structure of the recently passed 2014 farm bill on farm management and crop production decision making. Agricultural economists in the region have been meeting annually for many years to discuss ongoing research and extension activities being conducted at the various universities to address these issues. The purpose of the Delta Region Farm Management and Agricultural Policy Working Group (SERA-35) has been to address these and other relevant issues and to analyze the impact of such issues on the economic viability of commercial farming operations in the region from a farm management perspective.

Much of the research and extension activities of faculty within SERA-35 over the past few years has focused primarily on two farm management areas: commodity production cost estimation and agricultural commodity policy analysis. One of the primary objectives of this group has been to develop, estimate and publish annual production cost estimates of major agricultural enterprises in the region. This work requires major efforts related to data collection of major production practices and input prices, computer model development and estimation of variable and fixed commodity production costs under a range of production technologies and practices. Recent commodity production cost publications produced by the three states, along with related farm planning and crop production economic analyses, are listed in the reference section of this proposal. Over the past few years, faculty members from the three states have spent a considerable amount of time educating agricultural producers regarding program decision options under the 2014 farm bill. This activity has included numerous presentations, publications and other outreach efforts. A listing of each state’s 2014 farm bill information web site is listed in the reference section at the end of this proposal.

Objectives

  1. Host an annual meeting for the purpose of communicating ongoing research and extension programs in farm management and production economics, identify research and extension needs, and discuss approaches for addressing those needs.
  2. Continue the development of computer software and data bases to support the estimation and publication of production costs for major agricultural commodities in the Delta Region of Arkansas, Louisiana and Mississippi and adjacent production areas in other states as needed.
  3. Evaluate implications of new production technologies, farm policy changes and other factors on the production economics of major crops in the region, including corn, cotton, rice, sorghum, soybeans, sugarcane and wheat.

Procedures and Activities

This SERA group would include participants in the farm management area of the agricultural economics discipline. The activity would be a multi-state effort with primary research and extension participants from the states of Arkansas, Louisiana and Mississippi. Research activities will focus on the production economics of major agricultural row crops in the region. This activity is primarily related to three of the five federal-state partnership goals as specified by the Southern Association of Agricultural Experiment Station Directors. These three goals, with relevant activities from this proposed SERA group identified, include: Goal 1: An agricultural system that is highly competitive in the global market (integrated and sustainable agricultural production systems, precision agriculture, competitiveness in international markets), Goal 4: Greater harmony between agriculture and the environment (multiple uses of agricultural lands, nutrient management in agricultural systems, environmental policy and regulations), and Goal 5: Enhanced economic opportunity and quality of life for Americans (economic and policy analysis of agricultural industrialization, risk management and assessment in agricultural systems). Extension activities will be in the area of production agriculture, focusing on research and educational information and programs which can assist producers facing farm management and crop production decisions contributing to the long term economic viability of production agriculture across the region.

Expected Outcomes and Impacts

  • Objective one encompasses one of primary activities of this group, that is, to meet annually for the purpose of information exchange related to research and extension activities in the area of farm management and production economics. Members will have the opportunity to give presentations on various research and extension efforts in their respective states, both in terms of general objectives as well as specific research and/or extension activities. Through group discussion, research and extension needs in the farm management/production economics area will be identified along with potential approaches to address these needs.
  • Objective two will be accomplished through the continuation of ongoing collaborative work related to the estimation of production costs for major agricultural commodities in the region. The Mississippi State Budget Generator will continue to be the primary quantitative tool used in developing production cost budgets for various crop production systems commonly found across the region. Much of the current focus is on developing spreadsheet-based software capable of estimating projected values of variable and fixed production costs for agricultural enterprises in the region. Furthermore, as new crop production technologies are developed and adopted, enterprise budgets will need to be developed to reflect production practices associated with this technology as well as the expected production costs. Expected outcomes from this activity will include development of agricultural production data bases which can be utilized for research and analysis of various farm management and policy issues as well as the annual publication of estimated production costs for major row crops and production technologies.
  • Objective three represents a collection of efforts through research and extension to address a variety of issues and factors which become relevant over time and have a direct impact on the economic viability and financial performance of agricultural farming operation. Examples such as the development of new crop production technologies, changes in farm program provisions, changes in commodity supply and demand market structures represent the types of factors which would be evaluated. A variety of research methods, including whole farm financial simulation, would be utilized to identify likely economic outcomes. This research would then provide information which could be communicated to agricultural producers through a variety of extension efforts.

Projected Participation

View Appendix E: Participation

Educational Plan

Research and extension information will be disseminated to stakeholder groups through means of publication and presentations. A web site will be developed which will provide electronic copies of all analyses, reports and publications developed. Presentations of analysis results of specific issues addressed will be given to clientele groups as requested.

Organization/Governance

A chairman for the SERA group will be selected on an annual basis. An executive board of the SERA group will form the primary decision making body. Each of the three states (Arkansas, Louisiana and Mississippi) shall have a representative on the executive board.

This group will have a formal meeting annually to be held at a mutually agreed upon time and location. Furthermore, additional meetings may be held on an as needed basis to facilitate collaborative research and extension activities of the group.

One of the primary activities of this group will be to seek external funding opportunities to support the group’s research and extension objectives. Potential external funding sources will include competitive grants as well as external funding from stakeholder groups and other sources.

Literature Cited

Selected Commodity Production Cost Publications:

Deliberto, Michael A., Michael E. Salassi and Brian M. Hilbun, Projected Costs and Returns Crop Enterprise Budgets for Corn Production in Louisiana, 2015, LSU Agricultural Center, Dept. of Agricultural Economics and Agribusiness, A.E.A. Information Series No. 300, January 2015.

Deliberto, Michael A., Michael E. Salassi and Brian M. Hilbun, Projected Costs and Returns Crop Enterprise Budgets for Cotton Production in Louisiana, 2015, LSU Agricultural Center, Dept. of Agricultural Economics and Agribusiness, A.E.A. Information Series No. 301, January 2015.

Deliberto, Michael A., Michael E. Salassi and Brian M. Hilbun, Projected Costs and Returns Crop Enterprise Budgets for Sorghum Production in Louisiana, 2015, LSU Agricultural Center, Dept. of Agricultural Economics and Agribusiness, A.E.A. Information Series No. 303, January 2015.

Deliberto, Michael A., Michael E. Salassi and Brian M. Hilbun, Projected Costs and Returns Crop Enterprise Budgets for Soybeans Production in Louisiana, 2015, LSU Agricultural Center, Dept. of Agricultural Economics and Agribusiness, A.E.A. Information Series No. 304, January 2015.

Deliberto, Michael A., Michael E. Salassi and Brian M. Hilbun, Projected Costs and Returns Crop Enterprise Budgets for Wheat Production in Louisiana, 2015, LSU Agricultural Center, Dept. of Agricultural Economics and Agribusiness, A.E.A. Information Series No. 306, January 2015.

Falconer, Larry, et al., Rice 2015 Planning Budgets, Department of Agricultural Economics, Mississippi State University, Budget Report 2014-04, October 2014.

Falconer, Larry, et al., Soybeans 2015 Planning Budgets, Department of Agricultural Economics, Mississippi State University, Budget Report 2014-02, October 2014.

Flanders, Archie, et al., 2015 Crop Enterprise Budgets, Department of Agricultural Economics and Agribusiness, Northeast Research and Extension Center, University of Arkansas, AG-1302, March 2015.

Riley, John Michael, et al., Cotton 2015 Planning Budgets, Department of Agricultural Economics, Mississippi State University, Budget Report 2014-01, October 2014.

Salassi, Michael E., Michael A. Deliberto and Brian M. Hilbun, Projected Costs and Returns Crop Enterprise Budgets for Rice Production in Louisiana, 2015, LSU Agricultural Center, Dept. of Agricultural Economics and Agribusiness, A.E.A. Information Series No. 302, January 2015.

Salassi, Michael E., Michael A. Deliberto and Brian M. Hilbun, Projected Costs and Returns Crop Enterprise Budgets for Sugarcane Production in Louisiana, 2015, LSU Agricultural Center, Dept. of Agricultural Economics and Agribusiness, A.E.A. Information Series No. 305, January 2015.

Williams, Brian, et al., Corn, Grain Sorghum and Wheat 2015 Planning Budgets, Department of Agricultural Economics, Mississippi State University, Budget Report 2014-03, October 2014.


Selected Production Economics and Farm Management Publications:

Deliberto, Michael A., and Michael E. Salassi, Estimated Costs of Precision Grading Sugarcane Field, 2014, LSU Agricultural Center, Dept. of Agricultural Economics and Agribusiness, Staff Report No. 2014-06, March 2014.

Falconer, L., and T. Walker, “Comparison of Survey Results and Budget Recommendations for Mississippi Rice Production,” Proceedings of the Thirty-Fifth Rice Technical Working Group Meeting, p. 150, Louisiana State University Agricultural Center, 2014.

Flanders, Archie, Input Cost Trends for Arkansas Field Crops, 2008-2014, Department of Agricultural Economics and Agribusiness, Northeast Research and Extension Center, University of Arkansas, AG-1301, August 2014.

Flanders, Archie, Trends in Net Returns for Arkansas Field Crops, 2007-2013, Department of Agricultural Economics and Agribusiness, Northeast Research and Extension Center, University of Arkansas, AG-1298, February 2014.

Salassi, M. E., M. A. Deliberto, S. D. Linscombe, C. E. Wilson, Jr., T. W. Walker, G. N. McCauley, and D. C. Blouin, “Varietal Differences in Impact of Crop Lodging on Rough Rice Milling Yield and Market Price,” Proceedings of the Thirty-Fifth Rice Technical Working Group Meeting, p. 152, Louisiana State University Agricultural Center, 2014.

Salassi, Michael E., Michael A. Deliberto, Kenneth A. Gravois and Benjamin L. Legendre, Economic Value of Prescribed Burning to the Louisiana Sugarcane Industry, LSU Agricultural Center, Publication No. 3362, September 2014.


2014 Farm Bill Information Web Sites:

University of Arkansas Farm Bill Information Site:
[http://www.uaex.edu/farm-ranch/economics-marketing/farm-bill/]

Louisiana State University Agricultural Center Farm Bill Information Site:
[http://www.lsuagcenter.com/en/our_offices/departments/Ag_Economics_Agribusiness/extension_outreach/2014-Farm-Bill-Information/]

Mississippi State University Farm Policy Blog,
[http://blogs.msucares.com/agecon/tag/farm-bill]


Attachments

Land Grant Participating States/Institutions

AR, LA, MS

Non Land Grant Participating States/Institutions

University of Arkansas at Monticello School of Ag
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