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  • Turkeys – A 2025 Holiday Outlook

    Turkeys – A 2025 Holiday Outlook

    A few weeks ago, the current state of beef and pork prices was addressed in Southern Ag Today. Poultry, namely chicken and turkey, make up the bulk of the remainder of the American animal protein diet. Chicken is at the top of the list, with over 100 pounds per capita annually consumed. Turkey, on the other hand, is last on the consumption list. 

    However, Thanksgiving is Turkey’s time to shine. This seasonal demand certainly affects price, but it is also part of the turkey production schedule. Late May or early June placements of young toms are targeted to be ready to hit the fresh market for Thanksgiving. August placements would target smaller young hens. So far in 2025, poult placement is down every month leading up to August compared to last year. Also, turkey egg set was lower in most months in 2025 compared to 2024. However, July eggs set in hatcheries for August poult placement are up 1 percent over last year. Depending on the hatch, these eggs could bolster more fresh birds ready for the table in November. But overall, there have been fewer poults placed in 2025, likely meaning fewer fresh young toms and hens, which could lead to higher prices this holiday. The frozen market, while seasonally trending up, has less pounds of turkeys in cold storage compared to years past (Fig. 1), which also suggests a lower supply this holiday season. 

    With lower supply usually comes higher prices. In Fig. 2, we see that, for both large and small lot purchases, fresh turkey prices are higher in 2025 than in 2024. Although large quantity buyers were steady at $1.40/lb going into fall, those prices may increase over the next month as availability dwindles, and holiday inventory build begins. In fact, early September trading is trending in the $1.55/lb area. Many of these birds may be going into cold storage for Thanksgiving sales. 

    While current turkey prices are looking positive for producers, turkey growers have had a difficult time these past few years dealing with the loss of over 18 million birds to Highly Pathogenic Avian Influenza (HPAI). Overall production has been below historical averages in the past two years (Fig. 3). This fall has seen several cases of HPAI hit turkey operations, causing bird losses totaling 195,200 from August through early September. As wildfowl migration ramps up, more cases will likely appear this fall. Depending on the timing and severity of such outbreaks, the fresh turkey market could get hit with additional supply shrinkage, which would translate into yet higher prices for the 2025 holiday season.

    (Fig. 1) Frozen turkey in storage is lower this year than the previous three years but trending upward as is usual for the season. With overall placements being down, this decreased supply may linger and be a positive leverage for prices this year. 

    Fig. 2: Smaller turkeys, typically young hens, are where most whole birds come from, both fresh and frozen. Large truckload lot prices have been steady for these birds, perhaps reflecting contracted long-term pricing from larger buyers. However, as can be seen in the small lot pricing, as holiday demand starts to build, prices are likely to increase in the next month. 

    Fig. 3: Turkey production has been below historical average for the last two seasons, and looking at egg set and poult placement, this number is not expected to rebound soon.

    Brothers, Dennis. “Turkeys – A 2025 Holiday Outlook.” Southern Ag Today 5(38.2). September 16, 2025. Permalink

  • Risk Management

    Risk Management

    I was at a field day showcasing research conducted at one of our university’s research and education centers a couple of weeks ago. Land grant universities across the U.S. have similar research and education centers, where field research is conducted and results are shared with producers and industry stakeholders. These centers enable experts to conduct unbiased, scientific research that gets disseminated to future adopters of the production practices or technologies being studied. If you have a chance to attend a field day at a local university research and education center, you won’t regret the experience. At the end of this field day, we gathered in the air-conditioned conference room for a debrief. We asked producers and stakeholders about their thoughts and needs for future research and education. When the topic of agricultural economics came up, one producer mentioned the continued need for risk management education.

    So how do producers manage their risk?  What follows are a few thoughts on the five main areas of risk in agriculture: production, marketing, financial, legal, and human. 

    Production risk impacts the ability to produce livestock, poultry, or crops. The weather is unpredictable and impossible to control, but producers can diversify by growing a variety of crops or meat animals throughout the year. Appropriate crop rotations and nutrient management plans can ensure fertilizers are used efficiently. Integrated pest management programs can help reduce the risk of damage from insects, diseases, and weeds. The use of irrigation management systems can improve water use efficiency. Another way to manage production risk is with insurance, which can help cover losses that may occur from an unpredictable event that impacts production. 

    Marketing risk impacts the sale of products and the prices at which they are sold. Producers who know their cost of production can forward contract their products at prices above their costs to lock in their potential for profit. Creating a marketing plan takes out the indecision and emotional component that may occur when prices are changing. Producers may also use futures or options to hedge the cash price of the livestock or crops in production. Futures and options can help establish price floors or ceilings for products. Another way to manage marketing risk is through selling directly to consumers or joining a marketing cooperative to sell products with other producers. Crop insurance, with revenue protection, is also a tool that can be used to manage marketing risk.

    Financial risk impacts the business side of the farm or ranch. First and foremost, producers can manage financial risk through excellent recordkeeping and up-to-date financial statements. The use of financial recordkeeping software enables producers to monitor and manage financial performance measures like working capital, liquidity, return on investment, and profitability. Financial software can also be used to look at cash flow and see what times of year operating capital will be needed and when it can be paid off. Keeping an eye on family living withdrawals from the farm business is also important, as well as determining if off-farm income is needed to support the family.

    Legal risk impacts the farm business in terms of liabilities and compliance with regulations. The organizational structure of the farm business can be an important strategy to protect farm business owners from personal liability. Sole proprietorships, although easy to form, leave the owner personally liable for any debt of the farm business. Other forms of legal organizational structures include partnerships, limited partnerships, corporations, and limited liability companies. States may vary in the licensing and paperwork required to form different organizational structures, so producers are encouraged to seek advice from their accountant or an attorney. Managing legal risk also means being aware of laws and regulations that impact the farm business and complying with them at the local, state, and federal levels.

    Human risk impacts the people in the farm business, from owners and managers to heirs and employees. One way to manage risk between owners and heirs is to have an estate plan in place to help ease the transition of the farm business to heirs. Open communication is important within the family to ensure all members know their role in the farm business. Communication is also important with employees. There should be clearly written job descriptions with clear expectations on performance, and employees should receive appropriate training for their jobs. Managing human risk includes knowing and following all local, state, and federal labor laws that govern occupational safety and agricultural worker protections. 

    When risks are managed well, producers can minimize loss and increase their probability of profit. When you get a chance, attend the next field day at your local research and education center so you can learn how best to manage risk.

    Smith, Amanda R. “Risk Management.” Southern Ag Today 5(38.1). September 15, 2025. Permalink

  • Financial Literacy for All: Addressing Disparities Through Targeted Education

    Financial Literacy for All: Addressing Disparities Through Targeted Education

    Despite growing awareness of the issue, access to high-quality financial education remains inconsistent, especially in vulnerable communities. Studies have shown that early intervention, ideally during high school or even middle school, can lay the groundwork for responsible money habits later in life [Urb+20]. Educators and nonprofit organizations around the globe are now designing curricula focused on real-world financial skills: budgeting, navigating loans, understanding interest rates, and more. By integrating practical lessons into classroom settings, students can build confidence in handling money matters and cultivate healthy habits that last well into adulthood.

    Recent evidence further underscores the importance of targeting financial education efforts toward vulnerable groups. Wagner (2019) found that financial education, whether provided in high school, college, or through employers, is strongly associated with higher financial literacy scores, with the effect being especially pronounced among individuals with lower income and education levels. Using national survey data, the study highlights that financial education can substantially narrow financial knowledge gaps, particularly benefiting populations who are often vulnerable by traditional financial systems.

    This targeted approach is especially critical given the complex modern financial landscape. Recent surveys reveal that many adults struggle to grasp even the basics of personal finance. In 2024, the Personal Finance Index (P-Fin Index) published by TIAA Institute-GFLEC revealed that, on average, U.S. adults answered only 48% of the 28 questions correctly, indicating significant knowledge gaps in areas such as compound interest, inflation, and risk diversification [TG24]. This finding underscores a widespread lack of financial knowledge. Moreover, women, low-income individuals, and those with lower levels of education are particularly prone to these gaps [LM20], which further emphasizes the need for targeted educational interventions.

    From a broader societal perspective, enhancing financial literacy helps build stronger and more equitable economies, particularly for vulnerable communities. Research demonstrates that financially literate individuals are more likely to start small businesses, avoid predatory lending practices, and remain resilient during economic downturns [Con22; KLO15]. This is especially significant for low-income and minority populations who have historically faced barriers to financial information and services. A cross-national study of 143 countries found that regions with targeted financial education programs experienced increased formal banking participation among previously unbanked populations, reducing their reliance on exploitative informal financial services [GKM18; CSZ16]. When vulnerable communities gain financial knowledge, they become better protected against financial fraud and predatory lending practices that disproportionately target these populations [BS21].

    The necessity of financial literacy education cannot be overstated. Clear, accessible, and well-structured programs that address core concepts offer individuals of all ages the tools they need to manage their resources effectively. Bolstering one’s financial knowledge can have profound implications, not just for personal prosperity but for the economic well-being of entire communities [LM20].

    References

    [BS21] B. Balasubramnian and J. D. Springer. “Impact of Inflated Perceptions of Financial Literacy on Financial Decision Making.” Journal of Economic Psychology 82 (2021), p. 102343. DOI: 10.1016/j.joep.2020.102306.

    [Con22] Consumer Financial Protection Bureau. Financial Literacy Annual Report. Tech. rep., Consumer Financial Protection Bureau, 2022. https://www.consumerfinance.gov/data-research/research-reports/financial-literacy-annual-report/.

    [CSZ16] S. Cole, T. Sampson, and B. Zia. “Prices or Knowledge? What Drives Demand for Financial Services in Emerging Markets?” Journal of Finance 66.6 (2016), pp. 1933–1967. DOI: 10.1111/j.1540-6261.2011.01696.x.

    [GKM18] A. Grohmann, T. Klühs, and L. Menkhoff. “Does Financial Literacy Improve Financial Inclusion? Cross Country Evidence.” World Development 111 (2018), pp. 84–96. DOI: 10.1016/j.worlddev.2018.06.020.

    [KLO15] L. Klapper, A. Lusardi, and P. van Oudheusden. “Financial Literacy Around the World: Insights from the Standard & Poor’s Ratings Services Global Financial Literacy Survey.” World Bank Research Report (2015). https://gflec.org/wp-content/uploads/2015/11/3313-Finlit_Report_FINAL-5.11.16.pdf.

    [LM20] A. Lusardi and O. S. Mitchell. “Financial Literacy and Financial Resilience: Evidence from Around the World.” Financial Management 49 (2020). DOI: 10.1111/fima.12283.

    [TG24] TIAA Institute and Global Financial Literacy Excellence Center. 2024 TIAA Institute-GFLEC Personal Finance Index: Financial Literacy in the United States. Tech. rep., TIAA Institute, 2024. https://gflec.org/initiatives/personal-financeindex/.

    [Urb+20] C. Urban et al. “The Effects of High School Personal Financial Education Policies on Financial Behavior.” Economics of Education Review 78 (2020), p. 101786. DOI: 10.1016/j.econedurev.2018.03.006.

    [Wag19] J. Wagner. “Financial Education and Financial Literacy by Income and Education Groups.” Journal of Financial Counseling and Planning 30.1 (2019), pp. 132–141. DOI: 10.1891/10523073.30.1.132.

    Lee, Siun. “Financial Literacy for All: Addressing Disparities Through Targeted Education.” Southern Ag Today 5(37.5). September 12, 2025. Permalink

  • Measuring the Revenue Risk Reduction of Supplemental Crop Insurance Policies

    Measuring the Revenue Risk Reduction of Supplemental Crop Insurance Policies

    From 2015 to 2023, crop insurance programs played a critical role in protecting American farmers from financial risk, particularly in the face of increasing climate volatility. By combining basic policies—such as Actual Production History (APH), Yield Protection (YP), Revenue Protection (RP), and RP with Harvest Price Exclusion (RP-HPE)—with supplemental options like the Supplemental Coverage Option (SCO) and Enhanced Coverage Option (ECO), producers saw substantial improvements in both revenue stability and risk reduction.

    Under baseline conditions, the integration of these supplemental insurance layers resulted in a 27.9% increase in the chance to receive insurance funds that offset weather revenue losses, compared to farming without insurance. This revenue loss reduction comes from both subsidized premiums and indemnity payments that compensated for losses. More importantly, the variability in farm revenue dropped by nearly half—49.05%—and downside risks were dramatically reduced. Relative downside risk fell by 83.6%, while absolute downside risk declined by 80.98%. These figures reflect a significant buffer against income shocks, achieved at a relatively low cost: an actuarially fair premium rate of just 12.34 cents per dollar of liability, with 63.67% of that cost covered by federal subsidies. Farmers paid only 4.35 cents per dollar out of pocket.

    However, the benefits of crop insurance were not evenly distributed across all crops and regions. Cotton emerged as the crop with the highest reduction in downside revenue risk at 88.47%, followed closely by corn (85.91%), canola (83.41%), and wheat (82.42%). Other major crops such as soybeans, peanuts, and rice also saw meaningful reductions, but were lower than the crops above. Geographically, states like Arizona (cotton), Iowa (corn), Indiana (soybeans), Minnesota (corn), and Illinois (corn) led the nation in risk reduction, with rates exceeding 86%. In contrast, states such as Arkansas, California, Vermont, Louisiana, and West Virginia reported lower reductions, often below 71%.

    Further analysis revealed a trade-off: programs that delivered the greatest risk protection also tended to involve higher revenue transfers and greater out-of-pocket costs for producers. The One Big Beautiful Bill (OBBB or OB3) that passed in July 2025 included an increase in premium subsidy for SCO and ECO, increasing subsidy rates to 80%. Further, underlying basic policy subsidies increased by 5 percentage points. This balance between security and affordability remains a key consideration for producer decision making going forward.

    Together, these results underscore the importance of crop insurance as a cornerstone of agricultural risk management. As climate-related disasters become more frequent and severe, the role of insurance in stabilizing farm income and supporting rural economies will only grow more vital.

    Illustration of supplemental coverage combined with an underlying individual policy at 75% coverage level 

    Tsiboe, Francis, Hunter Biram, and Amy Hagerman. “Measuring the Revenue Risk Reduction of Supplemental Crop Insurance Policies.” Southern Ag Today 5(37.4). September 11, 2025. Permalink

  • Sorghum’s Big Crop, Bigger Risks

    Sorghum’s Big Crop, Bigger Risks

    The U.S. sorghum market enters 2025/26 with a bigger crop, weaker domestic demand, and uncertain access to China. The U.S. Department of Agriculture projects U.S. sorghum production at 9.94 million metric tons (MMT), up nearly 14% from last year. At home, demand is wilting, with domestic use set to fall by almost a quarter. The market hinges on foreign demand, especially from China.  

    China’s use is expected to jump nearly 50% in 2025/26 to over 11 MMT, and imports may approach 8 MMT (USDA-ERS, 2025). On a 2019-2023 quantity average, about 72% of China’s sorghum imports came from the United States (FAO, 2025). Yet, the U.S. export rebound is far from assured. In early 2025, following the U.S.-China trade dispute, Beijing imposed duties on U.S. sorghum and suspended firms on quality grounds. Shipments to China fell more than 95% in the first half of the year (Table 1). 

    Australia and Argentina moved quickly to fill part of the gap, sending sorghum—including some cleared for baijiu (a Chinese liquor made from fermented sorghum)—into South China ports. For farmers across Texas and the Southern Plains, the result has been a fragile Gulf basis, highly sensitive to whether Chinese demand resumes or alternative buyers step in. Mexico remains steady; Spain is emerging (Table 1); and Vietnam is showing interest. But no one matches Beijing’s scale. 

    The season-average farm price is forecasted to be near $3.70/bu., with sorghum trading at a discount to corn. A strong Chinese pull narrows the corn-sorghum spread; policy frictions widen it. In the near term, the U.S. has grain but not guaranteed access. 

    Producers can hedge sorghum against corn futures, closely monitor export flows, and scale sales when rallies appear due to demand from China or Mexico. For now, USDA is projecting U.S. sorghum exports to China to more than double to 5.72 MMT in 2025/26 (Figure 1). Ultimately, sorghum’s fate rests less in fields than in the outcomes of geopolitics.

    Figure 1 – U.S. Sorghum Supply, Use, and Ending Stocks. 

    Obs.: This figure compares USDA ERS/WASDE 2024/25 estimates with 2025/26 August projections. All values are in million metric tons.
     Source: USDA-ERS (2025). 

    Table 1 – U.S. Sorghum Export Shipments by Destination (metric tons

    Country20242025
    Qtr1Qtr2Qtr3Qtr1Qtr2Qtr3
    China1,944,8221,156,2801,018,67083,2913,117 
    Colombia  53
    Eritrea32,55133,00033,000   
    Haiti  239
    Japan809,061406036,2039,471
    Mexico493 23,724202,791117,619
    Spain   51,932110,34233,967
    Taiwan  2,000
    United Kingdom   22  
    Total1,977,9461,198,3411,051,710159,268354,453161,110
    Obs.: Quarterly exports correspond to the sum of USDA FAS “Weekly Exports” for the weeks in that quarter. “Weekly Exports” are actual shipments that left the United States during the reporting week (Friday–Thursday), as reported by exporters under the Export Sales Reporting program. Quarters are calendar quarters (Q1=Jan–Mar, etc.); totals may differ from WASDE marketing-year exports (Sep 1–Aug 31) due to different time windows, sources, and rounding.
    Source: USDA-FAS (2025). 

    References

    FAO (2025). FAOSTAT: Detailed trade matrix (TM) [Data set]. Retrieved September 8, 2025, from https://www.fao.org/faostat/en/#data/TM

    USDA-ERS (2025) Commodity Outlook – WASDE projections at a glance. Retrieved September 2, 2025, from https://www.ers.usda.gov/topics/farm-economy/commodity-outlook/wasde-projections-at-a-glance

    USDA-FAS (2025). Export sales query system. Retrieved September 2, 2025, from https://apps.fas.usda.gov/esrquery/esrq.aspx

    Calil, Yuri, and Pancho Abello. “Sorghum’s Big Crop, Bigger Risks.” Southern Ag Today 5(37.3). September 10, 2025. Permalink