Pub. 2 2013 Issue 3

14 l e a d i n g a d v o c a t e f o r t h e b a n k i n g i n d u s t r y i n k a n s a s T he current agriculture super-cycle has gone on for ten years and everyone wants to know when it will end. Dr. David Kohl acknowledged this reality as he addressed the 2013 Kansas Ag Bankers Conference in Manhattan on March 13-14. The state of global economics and more specifically, t he trends in emerging nations such as China, South Korea, Mexico and Turkey play a large role in the volatility of Kansas agriculture. With a description of this new inter-connectivity and other characteristics of all super-cycles, Dr. Kohl broke down his analysis of the economic indicators. With all eyes on him, Dr. Kohl said, “If it grows too fast, it’s a weed.” Then he closed his talk with the statement, “We need to be conservative in good times, courageous in tough times and consistent all the time.” Brian Briggeman, Associate Professor of Agricultural Econom- ics at Kansas State University, explained that when real interest rates are negative, farm incomes boom and this coincides with the increase in agricultural income. With Quantitative easing as a continued policy and the value of the dollar dropping, ex- ports are abundant driving commodity prices higher. He went on to explain how this boom compared to others with respect to inflation levels and debt to income ratios. According to Briggeman, two groups stand to lose significant wealth as this cycle winds down. They are large farms with greater than $1 million in farm sales and young farm operators, younger than 35 years old. A presentation was given by Dave Newell, Kansas Geological Survey, on the process of Horizontal Drilling and Hydraulic Fracturing, followed by a review of the positive economic impact of the Kansas Oil and Gas Industry by Ed Cross, President of Kansas Independent Oil and Gas Producers Association. Wayne Humphreys, an agricultural humorist and Iowa corn farmer, wrapped up the first day with a challenge for attendees to choose to have a positive attitude and coupled that challenge with a laugh or two. Day two of the conference began with an early morning agri- cultural news update provided by John Jenkinson with The Ag Network/KSNT in Wichita, followed by the annual meeting of KBA’s Kansas Ag Bankers (KAB) Division. The annual meeting included approval of the Division’s financial reports and the approval of new division officers and board members, including the induction of Shan Hanes, First National Bank of Elkhart as the new KAB Division President. A description of what to expect with cattle pricing as cow herds are built back up was provided by Randy Blach, Cattle Fax. He went on to explain that pork and poultry will continue to increase production and the market share for beef will in turn be down. Blach also discussed global trading influences as well as drought conditions and corn yield impact on today’s cattle market. Darrell Holaday, Advanced Market Concepts, delivered a talk focused on the political landscape in Washington, D.C. and how it affects the stimulation of the economy. He compared Japanese policy and historical trends compared to that of the United States. Holaday cautioned that even though some forecasters are predicting that if the drought continues it won’t have a large impact on the economy, he believes it would have Ag Bankers Review Current Economic Boom at their 2013 Conference 2013 KBA - Kansas Ag Bankers Division Board includes pictured from left, Matt Lee ( Centera Bank, Satanta), Tim Smith (Astra Bank, Hays), Troy Soukup (Citizens State Bank & Trust Co, Ellsworth), Jan Endicott (Stockgrowers State Bank, Ashland), Elsa Havel (Grant County Bank, Ulysses), Marvin Anliker (American State Bank & Trust Co., Garden City), Mike Walsman ( Community National Bank & Trust, Iola) back row left Greg Rodvelt (Horton National Bank, Horton), TJ Wilson ( Union State Bank, Everest), Shan Hanes (First National Bank of Elkhart), Ed Mohney (Community National Bank, Seneca), Steve McGinn (The Halstead Bank), Doug Ray ( First Security Bank & Trust Co, Norton.