June 21, 2017

CornsTalk: Trade Matters to Nebraska's Economy

With the productivity of U.S. agriculture growing faster than domestic demand, U.S. farmers and agricultural firms rely heavily on export markets to sustain prices and revenues. And while most of the corn produced in Nebraska stays in the state to be processed through livestock or ethanol plants, exports are still a critical factor in the economic success of Nebraska’s corn farmers.

“At the end of the day, a bushel of corn that leaves the U.S. for a foreign marketplace is a bushel of corn that adds value to the corn we grow and process right here in Nebraska,” said David Merrell, a St. Edward, Nebraska, farmer and chairman of the Nebraska Corn Board. “About 1 in 3 bushels of U.S. corn is exported in some form. Without exports, that corn would stay here in the U.S., creating a huge surplus and depressing prices all across the country, including here in Nebraska.”

“Corn producers in Nebraska are especially well positioned to benefit from international trade,” said Philip Seng, president and CEO of the U.S. Meat Export Federation. “You have an abundant and reliable supply of corn, and you’re a top producer of red meat. More than one-fourth of your pork and about 14 percent of your beef is exported, allowing Nebraska to capitalize on the world’s growing appetite for high-quality red meat.”

This track record of abundance is a key reason behind Gov. Pete Ricketts’ increased emphasis on international trade missions. Since he took office, Gov. Ricketts has led missions to Japan, China and the European Union.

 Gov. Ricketts has placed a high priority on leveraging Nebraska’s global leadership in agriculture production and creating export opportunities for the state’s farmers and ranchers. “Our goal is to add value to every bushel of Nebraska corn we grow by transforming it into ethanol, distillers grains, biochemicals, and protein such as beef, pork, dairy and poultry,” Gov. Ricketts said. “These trade missions are focused on positioning Nebraska as a preferred provider of these products and creating sustained demand to keep our state’s top industry thriving.”

“Relationship building continues to be important, but we’ve shifted our primary focus during these missions to activities that have an immediate or near-term impact on demand and sales,” said Greg Ibach, director of the Nebraska Department of Agriculture. “We’re aggressively asking for the business, and it’s making a measurable impact. The China mission alone resulted in nine purchase agreements for Nebraska beef and pork exports to that nation.”

In Europe, the market share for Nebraska beef has grown from 5 percent in 2015 to 50 percent today, according to Ibach.

To read more about trade in Nebraska click here to view the whole Spring 2017 CornsTalk publication.

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