CALF_News_April_May_2021

40 CALF News • April | May 2021 • www.calfnews.net Continued on page 44  Beyond the Ranch Gate Opportunity or Evil? By Blaine Davis Contributing Editor W ith 2021 already one-fourth over, I am still stunned by the events of 2020’s last quarter and its fallout. By the new administration’s reversal of many of Trump’s policies, my ventures, both personal and business, are uncertain. I liken it to Farm Journal news director John Herath’s recent statement on the Biden pres- idency and climate change. “It’s kind of like when that Amazon box shows up and you’ve brought it in the house and you’ve got it sitting on the table. You know it’s here, but you don’t know what’s in it yet.” As I pull my “iron steed” beside the gasoline pump, I do know one thing that’s in the box – higher petroleum prices, with an increase approaching 30 percent just since his inauguration. Much of the fossil fuel industry is in jeopardy, as the first attack on our energy independence came with the stroke of Biden’s pen stopping work on the Keystone XL pipeline. With this came lay-offs of high-paying career jobs in the energy sector from Canada to the Gulf Coast. Having just experi- enced one of coldest periods in my 60-plus years that ranged from the Rocky Mountains east, my thoughts centered on our farm and how the wheat crop fared. Much like a cat, farmers lament to wheat having nine lives to endure drought, insects, diseases and, hopefully, this recent cold blast. But to many others, especially those in Oklahoma and Texas, their thoughts centered on keeping warm and keeping their domestic water flowing as rolling electrical blackouts and natural gas shortages affected millions of citizens. Watching the evening television news, Texas Sen. Ted Cruz stated that 23 percent of Texas’ energy had shifted to wind and solar, but during this cold front accompanied with freezing rain and snow, this dropped to just 2 percent. Due to the icing of the windmill blades much like that on aircraft during the winter, a call was out for helicopters burning petroleum-based fuel to spray petroleum-based de-icing solutions on the blades to resume production. This mental picture combined with my dis- dain for the highways being congested with the transportation of these behemoths, “what sense can be made of this?” Consequently during this cold spell, natural gas spot prices soared to more than $1,000 per dekatherm, causing my fellow Farmers Gas Pipeline Board members and me much consterna- What's in the Box? tion. While we have been very pro-active and purchase forward contracts for the fuel at below $3 for the irrigation months of April through September into crop year 2025, we were not cov- ered during February, which typically isn’t yet irrigation season. To add some margin of comfort (no pun intended), we added March 2021 gas to our portfolio at $3.80 per dekatherm, palat- able but still a 33 percent increase. In the same corner of this “box” akin to a Pandora’s Box, I find the uncertainty of future fertilizer costs and availability. With the increases of in the price of natural gas, a major component in production of nitrogen fertilizer vital to the corn crop, combined with a push at the federal level to regulate nitrogen and particu- larly nitrogen flow into ground water, another of my crop inputs is bound to rise. With the recent upward trend of corn prices, I did contract approximately one-third of my expected 2021 crop at a level I hadn’t seen for several seasons, much to the chagrin of my cattle-feeding friends. What appears to be a profitable and savvy situation may just actually offset my higher input costs. After surveying the condition of our wheat crop, it was back to the office where the building industry isn’t fairing any better with the leftward shift in politics and culture. As reported by one of my contractor partners, 2021 has experienced three consecutive months of steel price increases, amounting to 24 percent, the total of all of 2020. Coupled with the added energy costs to harvest timber, produce cement and deliver such to the job-sites, several of my projects are budget-hampered and may become unfeasible. Peering into this “box” further, I can see that accompanying the uncertainty of supplies and costs related to fossil fuels will be more climate policy and carbon restrictions and“their markets.” Agriculture and especially beef production get a bad rap on this subject and its sustainability. Often quoted by this author, Frank Mitloehner, Ph.D., professor at University of California, Davis, Department of Animal Sciences, has dispelled many myths about greenhouse gases and animal agriculture. “Most other sectors in society only produce greenhouse gases, but there are two sectors that are both sources and sinks: forestry and agriculture. These land-use sectors, forestry and agriculture take on more carbon than they emit,” he said. The methane that livestock produce has a half-life of 10 years, so it’s not just produced, but consumed. Comparably, it takes 1,000 years to remove carbon dioxide that makes up to 80 percent of greenhouse gases in the United States. At the recent 2021 Cattle Industry Convention Reboot, Jason Sawyer, Ph.D., associate professor and research scientist with the King Ranch® Institute for Ranch Management said, “Carbon uptake through grazing lands can help offset non- methane emissions currently attributed to beef production. If