In This Issue:

• Barley Production Update
• Ag Conservation Funding Enacted
• Barley Producers Receiving Disaster Assistance
• Dates Set for 2023 NBGA Meetings

Barley Production Update

Following are excerpts from a barley production report compiled by the North Dakota Barley Council that provides good insight into the barley situation and outlook for 2022.

Area planted to barley increased in the United States in 2022 as the barley industry seeks to rebuild inventory. Open market supplies of unpriced barley continue to remain limited, as reflected in the June 30th USDA-NASS stocks report.

Updated information from the August 12th crop production report indicates that nationally, growers planted 3,026,000 acres of barley in 2022, an increase in planted area of 14% from the 2,660,000 acres planted in 2021. North Dakota producers planted 670,000 acres of barley in 2022, an increase of 16% from the 580,000 acres planted in 2021. Montana growers increased barley planting 16% from 2021.

Nationally, barley production is estimated at 157,848,000 bushels, an increase of 34% from 2021. North Dakota barley production is estimated at 34,100,000 bushels, an increase of 55% from the 21,930,000 bushels produced in the drought year of 2021. Montana barley production is estimated at 35,910,000 bushels, an increase of 51% from 2021. Idaho barley production is estimated at 53,200,000 bushels, an increase of 22% from 2021.

Barley stocks have declined from 2021 to 2022, largely due to decreased yields in 2021 caused by drought conditions. Nationally, barley stocks in all positions declined 41% from 71,418,000 bushels in June 2021 to 42,160,000 bushels in June 2022, further indicating the impact the 2021 drought had on production and inventory levels. Barley stocks (total of both on-farm and off-farm positions) for North Dakota declined 50% from 14,269,000 bushels in June 2021 to 7,104,000 bushels in June 2022. Remaining stocks are likely inventory that is already priced under malting barley contracts or pet food contracts, as buyers have indicated that residual (open market) supplies of barley remain limited (if not non-existent). The major barley producing states all reported a decline in stocks. Inventory levels and subsequent stocks will likely increase following the 2022 barley harvest.

The reduced level of open market supplies of barley stimulated increased prices in the spot cash market for barley in the malt, feed, and pet food categories in May and June of 2022, with prices declining slightly in July and early August in preparation for the 2022 harvest.

Ag Conservation Funding Enacted

On August 16^th, President Biden signed into law the comprehensive reconciliation package, which they named the Inflation Reduction Act. The package includes approximately $40 billion for programs administered by the U.S. Department of Agriculture, including $18 billion for ag conservation programs to be distributed as follows:

Environmental Quality Incentive Program (EQIP) - $8.45 billion

Conservation Security Program (CSP) - $3.25 billion

Regional Conservation Partnership Program (RCPP) - $4.95 billion

Agricultural Conservation Easement Program (ACEP) - $1.4 billion

An additional $1 billion would be provided to USDA’s Natural Resources Conservation Service for conservation technical assistance and $300 million is allocated to USDA for measuring the impact of agricultural practices on greenhouse gas emissions. All of the funding in this package must be spent within ten years and funding for RCPP was actually reduced from the initial proposal because the Congressional Budget Office determined USDA would not be able to spend the entire amount within the ten-year window.

Also included in the bill for Ag/USDA:

• Over $5 billion for wildfire prevention and climate resiliency projects in public and private forests.
• $9.7 billion for rural electric cooperatives for renewable energy and energy efficiency projects and $1 billion in loans for renewable energy projects in rural areas. 
• $4 billion in Bureau of Reclamation funding for compensation to water users for temporary reductions in water usage; projects that reduce use of or demand for water supplies or provide environmental benefits in the Colorado River Basin; and for ecosystem and habitat restoration projects that address drought impacts.
• $2 billion for USDA's Rural Energy for America Program (REAP), which funds renewable energy and energy efficiency projects. 
• $500 million for blender pumps and other biofuel infrastructure. 
• $3.1 billion in assistance to "distressed" borrowers who hold direct or guaranteed farm loans. 
• $2.2 billion in payments to farmers who experienced discrimination in USDA loan programs. The payments would be capped at $500,000 per producer. The debt relief provisions would be paid for by repealing a previous debt relief program authorized by the American Rescue Plan in 2021 that was ruled unconstitutional by the courts. 

The cost of the reconciliation bill is offset through a 15% minimum tax on corporations, a new excise tax on stock buybacks and a provision that would allow Medicare to negotiate drug prices.

Barley Producers Receiving Disaster Assistance

USDA has posted a dashboard that provides a breakdown of Emergency Relief Program (ERP) payments by crop. For ERP, a total of over $6.2 billion has been paid thus far, including $44.65 million for barley. This supplemental disaster assistance funding was enacted by Congress to help agricultural producers offset the impacts of natural disasters such as drought and wildfires in 2020 and 2021.

Read more here...

Dates Set for 2023 NBGA Meetings

NBGA will hold a Board Meeting in Washington, DC February 6-8 and our June meeting will be June 12-15 in St. Louis, MO. The June meeting will include a joint meeting with the American Malting Barley Association (AMBA).