Southern Ag Today

Blog

  • Southern States Address Solar Facility Decommission

    Southern States Address Solar Facility Decommission

    As Southern states pass their first decade of solar photovoltaic (PV) development, state policy-makers can view a horizon when many tons of solar PV equipment will require removal and disposal. Solar PV panels wear down under weather exposure, and at about twenty-four years cease useful and economic efficiency in generating electricity, and must be removed. Most solar PV facilities are developed by private companies upon leases with private landowners, which generally require the PV facility owner to remove equipment and restore land. However, such leases rarely address the specific costs of decommission, nor guarantee cash will be available to pay the costs, potentially exposing taxpayers and ratepayers to the financial burden of decommission. Land restoration has been a concern of rural communities and farm producers who have lost access to productive farmland devoted to solar PV development. 

    Though disposal of solar PV equipment is regulated under the federal Resource Conservation and Recovery Act (RCRA) (42 U.S.C. § 6901 et seq), decommission requirements are left to state authority. Virginia, Louisiana, North Carolina and Texas have enacted solar “end of life” (EOL) disposal legislation, and South Carolina recently allocated state budget funds to regulatory development. In other states without regulation, counties may still require decommission plans as a condition for rezoning for a solar PV facility. (Such a model ordinance has been drafted in Georgia.) Indeed Virginia’s statute places upon its counties a developer requirement of financial assurance in exercising zoning approval authority. 

    Under North Carolina’s regulatory mandate, the NC Department of Environmental Quality recently completed an in-depth stakeholder study exploring costs of decommission and site restoration, future recycling markets to offset such costs, the timing of waste volume (for example, see figure 1), and waste management capacity and hazardous waste determination. The report provides a detailed window into decommission issues, which may serve as a model for other Southern regulators. Click here for more on the North Carolina Report.

    Figure 1. Timing of Solar PV Waste Volume in North Carolina (courtesy NC Department of Environmental Quality)

    Recommended citation format: Branan, Robert Andrew. “Southern States Address Solar Facility Decommission.” Southern Ag Today 1(49.5). December 3, 2021. Permalink

  • Cuba: Potential Market or Continuing Menace?

    Cuba: Potential Market or Continuing Menace?

    Passage of the Trade Sanctions Reform and Export Enhancement Act of 2000 allows U.S. firms to legally export their agricultural products to Cuba and travel there for business purposes. From modest beginnings of $140 million in 2002, U.S. exports grew to $387 million in 2004, peaking at $694 million in 2008. U.S. exports then fell to $456 million in 2012, $215 million in 2016 and $157 million in 2020 (Figure 1). Frozen poultry, soy products and corn have accounted for virtually all U.S. export in recent years. Remittances, exports and tourism are major hard currency earners for Cuba and determine market potential, and the success of U.S. exports. Market potential is hampered by strict U.S. regulations on financing and Cuban requirements to export through the state trading entity, Alimport. Cuba has the potential to be a $1.0 billion market absent government restrictions and more open trade between the two countries. Competition is keen and growing as the U.S. presence in the market has declined.

    Recommended citation format: Rosson, Parr. “Cuba: Potential Market or Continuing Menace?” Southern Ag Today 1(49.4). December 2, 2021. Permalink

  • A Hot Market for Ag Land

    A Hot Market for Ag Land

    In August 2021, USDA National Agricultural Statistics Service published their annual report of state-level land values for farm real estate. The results of the report indicate a strong market in the Southeast, with Texas leading the region at a 9.7% increase in farmland values over 2020.

    What is driving this market depends on a few things. First, local market conditions are largely driven by crop yields and, in some areas, urban development influences. But there are some factors that are more macro in scale and have been affecting the land markets as well. Those include interest rates, commodity prices, and government payments. The Market Facilitation Program, which was designed to support farmers adversely affected by the trade war with China, contributed significantly to farm incomes in 2018 and 2019. In 2020 and early 2021, the Coronavirus Food Assistance Program provided financial assistance to farmers to alleviate impacts from market disruptions due to COVID-19. As a result of these government programs and increasing commodity prices in the last several months, land values have continued to stay strong in the Southeast and the rest of the United States.

    There has also been an interesting trend in farmland markets in some parts of the region where people are wanting to leave cities for smaller towns and rural areas. This has led to strong demand for small rural properties, which can escalate prices above the value implied by agricultural use alone. Not all rural areas are affected, but where they have been, the markets are very strong. The supply side of the land market is also important and strong commodity prices are prompting farmers to both look for more land and keep the land they have. This leads to a limited supply of land for sale which is driving prices up.

    So, will we see things continue into the near future with robust farmland values? That will depend on several factors, but I see the potential for higher interest rates and lower levels of government payments tempering some local markets. However, as long as commodity prices are up, and investors see farmland as a good alternative to the stock market there will be bidders for a limited supply of ag land and prices will remain strong. 

    Source: https://www.nass.usda.gov/Charts_and_Maps/Land_Values/farm_value_map.php

    Recommended citation format: Taylor, Mykel. “A Hot Market for Ag Land.” Southern Ag Today 1(49.3). December 1, 2021. Permalink

  • Huge Cow Culling in Southeast? Not So Fast, My Friend!

    Huge Cow Culling in Southeast? Not So Fast, My Friend!

    Beef cow slaughter has been higher than year-ago levels for most weeks in 2021. National beef cow slaughter is up about 10 percent (or about 6,000 head weekly average) since July over the same period of 2020. In the southeast reporting region which includes AL, FL, GA, KY, MS, NC, SC & TN, beef cow slaughter has been about 25 percent higher since July 2021 than it was during the same period of 2020. That is equivalent to an additional 2,000 head each week on average. This region accounts for about 15 percent of national beef cow slaughter. There has been some additional cow processing capacity brought online in the southeast in 2021 which helps explain the weekly increase in slaughter. But where are the cows coming from? Are producers in the southeast culling cows deeper than previously expected? Weekly auction receipts shed some light on these questions.

    Combined weekly auction receipts for slaughter cattle (reported as both cows and bulls) from GA, KY, and MS are up 3 percent since July compared 2020. That 3 percent increase equals an additional 128 head weekly average. The data is messy, and I don’t have the data for the other 5 states in the region, but the receipts don’t suggest enough of an increase in the number of cows being culled in the southeast to support the big increase in beef cow slaughter in the region. It seems likely that a good portion of the increase in slaughter are cows coming from other regions. Backhauling cows is likely a contributor when calves or feeder cattle are trucked from the southeast to other regions and cull cows come back. The January Cattle Inventory report will tell a more complete story of the changes in cows in each state. 

    Maples, Josh. “Huge Cow Culling in Southeast? Not So Fast, My Friend!” Southern Ag Today 1(49.2). November 30, 2021. Permalink

  • Peanut Outlook

    Peanut Outlook

    Peanuts are a predominant Southern crop, with Georgia, Alabama, Florida, and Texas – the top four states in 2021 planted acreage – accounting for over four-fifths of the area planted nationwide. Peanut acreage declined by 5% to 1.58 million planted acres in the US in 2021. This year’s peanut production is projected at 3.15 million tons, which would be a 2.2% increase above 2020. This forecast increase in production comes despite the decreased acreage planted and is driven by a projected 7.7% increase in yield over 2020, to 4,105 pounds per acre.

    Figure 1: 2021 Planted Peanut Acreage; Data source: USDA-FSA

    The strong peanut demand from the 2020/2021 marketing year is expected to continue and meet production this current marketing year. However, peanut stocks are expected to remain plentiful, above 1 million tons, a slight increase from last year. Prices for the 2021/2022 marketing year are expected to increase to $430/ton. The long-term outlook, as forecast by the Food and Agricultural Policy Research Institute (FAPRI), expects prices to remain in a similar range moving forward. 

    Figure 2: Past and Projected Peanut Prices by Marketing Year; Data sources: USDA-NASS and FAPRI-MU U.S. Agricultural Market Outlook (2021)

    Recommended citation format: Sawadgo, Wendiam. “Peanut Outlook.” Southern Ag Today 1(49.1). November 29, 2021. Permalink