January 25, 2015

Nebraska beef exports exceeded $1 billion last year

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A state official says Nebraska beef exports reached a new milestone with record sales during the first 11 months of 2014.

State ag director Greg Ibach says there were several factors leading to Nebraska’s beef producers exceeding the $1-billion mark in exports last year.

“Worldwide demand is strong and in Nebraska, we’ve put a lot of effort into trying to promote our products on a worldwide basis as well,” Ibach says, “and then you have the buying power of the middle class in Asia that is driving demand.”

Ibach says he’s optimistic about this year and hopes they’ll be able to continue the export momentum achieved last year.

“The price is leveling off a little bit,” Ibach says. “We doubled our volume while the price was just a little bit higher so really price and volume both went into us making this goal.”

Ibach adds, the value of beef muscle cut exports has increased 250% since 2009 while the total number of beef exports during the same time frame doubled.

Also, he says beef livers and tongues saw $93-million in exports, up from $32 million in 2009.

By Jerry Oster, WNAX, Yankton

 

Dropping gas prices are helping & hurting ethanol industry

gas-pump-111Gasoline prices are still falling across Nebraska and while it’s great news for motorists, those involved in ethanol production are seeing their profit margins shaved to remain competitive.

Nebraska Ethanol Board administrator Todd Sneller says it’s a good news-bad news scenario.

“We’ve seen a decline in the margins at ethanol plants but December was an unusual month given the lower gasoline prices,” Sneller says. “It was unusual in that there was a significant increase in demand worldwide for ethanol, with a lot of product going to Brazil and to Europe and some to China.”

Sneller says while gas prices are falling, demand for an ethanol by-product is on the rise.

“The decision by the Chinese government to again open the doors for distiller’s feed imports into China has created a huge demand for distiller’s feeds coming out of the ethanol plants,” Sneller says, “Of course, the only way to get distiller’s feeds is to make ethanol.”

Nebraska is the nation’s #2 producer of corn-based ethanol, behind only Iowa.

Sneller says many ethanol plants experienced good economic conditions in early 2014. Because of that, he says some plant operators have managed to deal with the recent low gasoline and oil prices.

Crude oil prices have fallen to $50 a barrel in many markets, half what it cost a year ago. AAA-Nebraska reports the statewide average price for gasoline is $2.01 per gallon.

By Jerry Oster, WNAX, Yankton

 

Cheap gas prices are treat for drivers, fright for Wall Street

gas-pump-111While gasoline is selling below $2 a gallon in some Nebraska cities, the great news for motorists is cause for alarm for investors.

Markets around the globe are showing signs of weakness as crude oil dropped to $50 a barrel, half what it was a year ago.

Creighton University economist Ernie Goss says stock markets in Europe and Asia are reeling and Wall Street is reacting.

“Investors are saying, well, sooner or later, that economic slowdown is going to hit the U.S., so that’s being reflected in the markets with economic pullbacks,” Goss says. “We’re seeing that in all the markets, whether it’s the Dow, whether it’s the S&P or the NASDAQ.”

Some fear Russia’s petroleum-heavy economy is nearing a critical low, while Goss says the U.S. economy has seen a big shift over the past decade.

“We’ve gone from an economy, the U.S. economy, of exports of about 4% of GDP, gross domestic product, to about 16%,” Goss says. “So, if we have pullbacks in Russia, that means they’re going to be buying less of our goods. We’re already seeing that in Europe as they buy less of our goods and certainly Asia is another place where we’re seeing a real pullback in economic growth and that’s going to mean they’re buying less of our goods.”

Nebraska is the nation’s #2 ethanol producer behind only Iowa and Goss says the steady drop in gas prices will force ethanol to respond.

“Overall, ethanol will be hurt by this,” Goss says. “Of course, ethanol competes with gasoline and is a blend in gasoline. With corn prices up a bit over the last couple of months, this is going to put a squeeze on the profit margins of ethanol producers.”

AAA-Nebraska reports gas prices in Nebraska are averaging $2.08 a gallon, the lowest in about five years.

 

Gov. Heineman says agriculture remains Nebraska’s economic base

Gov. Dave Heineman

Gov. Dave Heineman

Gov. Dave Heineman says the growth of agriculture spurred the great economic growth Nebraska has enjoyed the past few years.

And Heineman says agriculture in Nebraska is more diverse than it was 25 years ago.

“What I mean by that is the foundation of our economy is agriculture, but agriculture today doesn’t mean just the individual farm and ranch,” Heineman tells Nebraska Radio Network. “It means value-added agriculture. Well, one of the first things you think about there is the ethanol industry in the state. We’ve now become the second-leading ethanol producer. That helped us, along with our water resources and corn resources to become the number one cattle feeding state in America.”

Food processing also has become an economic driver in Omaha and Lincoln, according to Heineman.

Nebraska ranks high on many national economic rankings of states. It has the second lowest unemployment rate in the country, well below the national rate.

Heineman says agriculture remains the foundation.

“Agriculture is bigger, more diverse than we’ve ever had it before and it’s more inclusive than most of us think,” according to Heineman. “And then that’s led to the fact that we’ve got smart manufacturing in the state, more technology than we’ve ever had, our ethanol plants and others. We’re a leading insurance industry state. We’re a leader in transportation. But all of it kind of starts with agriculture.”

Rural Nebraska homeowners see benefits of USDA program

USDA Rural DevelopmentMore than $114-million in federal funding was delivered to Nebraska families for home repairs, rental assistance and home ownership last year.

USDA Rural Development housing grants are used in communities of 20,000 or fewer people, according to the program’s state director Maxine Moul.

Moul says, “We were able to help more than 1,100 families in rural Nebraska get into new homes, either their first-time homes or a larger home for a growing family or a couple who is downsizing.”

She says eligibility for housing programs and funding is dependent on income, credit and repayment ability. Also, the property must be in a rural area. Moul says the success of these programs is due to the structure of the grants.

“This program is self-funded,” Moul says. “As people pay back their principal and interest, it allows us to issue new loans and we don’t have to wait for Congressional funding. This funding is there constantly.”

Moul says USDA Rural Development funding for Nebraska totaled $189-million, which includes business and industry, energy, loans and grants, and improvements to rural electric and distance learning programs.

By Jerry Oster, WNAX, Yankton