December 12, 2017
Switches in Corn, Soybeans, and Wheat Acres in the U.S. and Illinois
Since 2012, acres in the U.S. have been shifting out of corn and into soybeans, likely as a result of higher returns for soybeans than for corn. The longer termed trends since 1996 have been increases in corn and soybean acres and decreases in wheat acres. Within Illinois, acreage shifts have been predominately between corn and soybeans.
December 11, 2017
Weekly Outlook: Corn Use for Ethanol Update
The recent strength in ethanol production has led to speculation about changes to USDA's estimate of corn used for ethanol in the pending WASDE report. Ethanol production for the week ending December 1 set a new ethanol production record with an average of 1.108 million barrels per day, continuing eight consecutive weeks of more than a million barrels a day of production. Currently, the WASDE forecast for corn consumption for ethanol production is 5.475 billion bushels, up 36 million bushels from 2016-17 marketing year estimates. The ability to surpass this projection is possible, but foreign demand for ethanol will be crucial as we move into 2018.
December 8, 2017
The Value of Decision Tools to Farmers and Landowners
As part of the 2014 Farm Bill, the Farm Service Agency (FSA) awarded funding to the National Coalition for Producer Education (NCPE), led by the University of Illinois, and the National Association of Agricultural and Food Policy (NAAFP), led by Texas A&M University and the University of Missouri, to develop online tools to help producers make their program choice decisions. This was a rare provision of resources in the farm bill for education and outreach efforts. In this post, we discuss how farmers and landowners evaluated the decision tools (the Farm Bill Toolbox) developed by the University of Illinois team. Results presented are based on the article recently published by Ellison et al. (2017) in Applied Economic Perspectives and Policy.
December 7, 2017
Crop Insurance per Acre Coverage: Historical Experience and Potential Issues
A long standing goal of U.S. crop insurance policy has been to increase the share of production it covers. Over time, both the numbers of acres insured and coverage levels have increased, leading to more coverage of production. Moreover, the amount of coverage has increased at a given coverage level due to policy decisions that have resulted in higher insurance yields and prices. As a result of these policy driven coverage enhancements, the same coverage level in 2017 will provide more coverage than in 2000. Collective impact of the policy driven coverage enhancements are examined by calculating the percent of value of production covered by crop insurance. Over time, the percent value of production covered by crop insurance has increased more than coverage level has increased.
December 6, 2017
Another Wrinkle in the RFS: The Small Refinery Exemption
2017 has been a busy year for the Renewable Fuel Standard (RFS). In July, the D.C. Circuit rejected EPA's interpretation of its general waiver authority. In September, EPA issued a Notice of Data Availability that sought comment and data exploring further avenues to reduce the portions of the advanced mandate. A week ago, EPA finalized the RFS volume obligations that maintained the statutory mandates in line with its proposed rule. On November 22, 2017, EPA also denied requests from petitioning interests to change the point of obligation for compliance with the RFS mandates. Finally, a recent court decision by the Tenth Circuit Court of Appeals may add yet another wrinkle to administration of the RFS. In that decision, a federal court concluded that EPA's denial of a waiver for small refineries was improper. This article reviews the small refinery issue and its potential implications for the RFS standards.