Dog-Walking Start-Up “Wag,” Grows Quickly– Personalization and Transparency are Key

Paresh Dave reported in yesterday’s Los Angeles Times that, “After selling his dating service ChirpMe to Europe’s Massive Media, Joshua Viner considered getting a dog. But whenever Viner talked about becoming a pet owner, people suggested he was too busy.

“Turns out, they were onto something.

“Viner’s new start-up, Wag Labs Inc., has found a customer base in busy pet owners. It’s among the fastest-growing early-stage start-ups in the Los Angeles region, and Silicon Valley investors are giving the West Hollywood company a close look.”

The article indicated that, “Wag, now up to 40 employees, connects dog owners with walkers and groomers through online software. Other pet-centric start-ups such as Rover and DogVacay offer additional or competing services, including dog-sitting.

“But Viner, chief executive and co-founder, says Wag is gaining market share through personalization and transparency. Owners get digital notifications from the walker or groomer at every stage of the process. Even the exact spot where and time when a dog takes care of its business during a walk is marked on an app and shared with the owner. Owners can request a live video feed of the journey.

“Wag takes as much as a 25% cut of walks, which run about $20 for 30 minutes, though special offers can reduce the payoffs. Viner declined to provide data about usage or sales.”

Yesterday’s L.A. Times article added that, “The company raised $2.45 million in initial funding from Greylock Partners, RRE Ventures, Structure Capital and others last year soon after launching in January 2015. Fresh funds could be essential as the company expands beyond its first handful of regions. Last week, Wag launched offerings in Denver and Portland, Ore.”

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Issues Regarding Monsanto’s New Herbicide-Resistant Biotech Soybean- Neighbor’s Crops Damaged

Jacob Bunge reported yesterday at The Wall Street Journal Online that, “Farmers in southern U.S. states have long battled weeds and destructive bugs, but this year they face a new threat: their neighbors.

“They say some growers are illegally spraying a powerful herbicide that is damaging hundreds of thousands of crop acres in Arkansas, Missouri and Tennessee, a trend that regulators, farmers and academics link to Monsanto Co.’s introduction this year of a new variety of genetically modified soybean.

“Monsanto’s new biotech soybean was designed to resist herbicides, including a powerful chemical called dicamba, long used to kill weeds but prone to drifting into neighboring fields. Monsanto sold farmers the new seeds before it was able to provide an updated version of the herbicide, designed not to drift. That new herbicide is still awaiting regulatory approval.”

The Journal article noted that, “Philip Miller, vice president of global regulatory affairs for Monsanto, said the company ‘took quite a bit of effort’ instructing farmers and pesticide dealers to avoid spraying older versions of dicamba over the new biotech beans, and the vast majority of farmers have complied. Monsanto doesn’t manufacture older versions of dicamba.

“The situation illustrates the potential pitfalls of genetically engineered crops and the regulatory system that governs plant genes and related chemical products. Damage to nearby fields could slash those farmers’ crop yields at a time when U.S. farmers already are on pace for their leanest year since 2002.”

Mr. Bunge added that, “A spokeswoman for the Environmental Protection Agency said the agency is investigating dicamba misuse and crop damage in the region, and that its findings would ‘inform’ its final decision on approving Monsanto’s new version of the herbicide, expected late summer or early fall of this year.

“In the meantime, farmers already have been spraying the new Monsanto soybeans with older formulations of dicamba sold by other companies, according to researchers and regulators, and farmers like Mike Wallace are paying the price.

“Mr. Wallace, who grows about 5,000 acres of soybeans, cotton and corn near Monette, Ark., noticed puckered leaves on his soybean plants in June, a telltale sign of dicamba damage. He estimated a hit to about 40% of his soybean fields, which aren’t engineered to resist dicamba, and has submitted a complaint to state officials.”

Yesterday’s Journal article also explained that, “While state regulators can fine farmers for illegal spraying, they can’t compensate neighboring farmers for losses, a separate process typically worked out between neighbors on country roads, or through civil lawsuits. And some believe the existing fines are too low: In Arkansas, for instance, the maximum is $1,000.”

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Crop of Startups Disrupting the 401(k) Industry

Anne Tergesen reported in yesterday’s Wall Street Journal that, “Disruption is coming to the 401(k) industry.

“Led by technology entrepreneurs and backed by venture capitalists, a crop of startups have launched online 401(k) plans in recent months with the aim of bringing robo-style automated investment services to small businesses, many of which offer their workers high-cost 401(k)s or no retirement savings plans at all.

“The upstarts are pursuing a large market that has been relatively ignored until recently—a vacuum that has prompted some states to start requiring small businesses to offer retirement plans. Among companies with 100 or fewer employees—a group that employs about 42 million people, or one-third of the private-sector workforce—only 14% sponsor a retirement plan, according to an estimate by the Government Accountability Office.”

Ms. Tergesen explained that, “The robos, which feature online service and low-cost indexed investments, are also trying to win business from the insurers and payroll providers that have long dominated the small end of the 401(k) market. Among the smallest plans, fees can run as high as 1.5% of assets or more a year, according to data from 401(k) plan tracker BrightScope Inc. and fund-industry trade group Investment Company Institute. In contrast, fees for participants in plans with more than $1 billion in assets average 0.26% of assets.”

The Journal article also noted that, “But while the startups—whose ranks include ForUsAll Inc., Dream Forward Financial LLC, SaveDay Inc. and Captain401 Inc.—see big possibilities in the small 401(k) market, there are hurdles. One is the difficulty of selling plans to mom-and-pop companies, a decentralized market in which many employers lack the time, expertise and money to put plans in place. Another is rising competition from more established low-cost players, including Employee Fiduciary LLC, a company that entered the small 401(k) market 12 years ago, and fund-industry giant Vanguard Group Inc., which launched a small-business 401(k) service in 2011.”

More specifically, yesterday’s article pointed out that, “The startups say it is a promising time to enter this market. Amid growing concern about insufficient retirement savings, four states—Maryland, Connecticut, Oregon and Illinois—recently passed laws that require many small businesses to offer retirement savings plans. Lawmakers in New Jersey and Washington have authorized state-run marketplaces to help small companies that want to set up plans. Some two dozen other states and a few cities have either commissioned studies or are considering similar legislation, according to AARP, and Georgetown University’s Center for Retirement Initiatives.”

And Ms. Tergesen added that, “Many of the startups focus on plans with 50 to a couple hundred employees. Their pitch: Technology can reduce the time and cost of managing a retirement plan, making it a benefit that small businesses can afford to offer their employees.”

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“Right to Farm” Issue Heats Up

Babara Hoberock reported on Sunday at the Tulsa World Online that, “The fight over a state [Oklahoma] question to enshrine the rights of farmers and ranchers in the state constitution is heating up.

“State Question 777 is called ‘Right to Farm’ by supporters and ‘Right to Harm’ by critics. Lawmakers put it on the ballot, where it will appear Nov. 8.”

The article noted that, “If passed, the measure ‘would provide the most far reaching constitutional protections for agricultural operations of any state,’ according to the legal analysis prepared by the Indian and Environmental Law Group, in Ada.”

Ms. Hoberock also indicated that, “Also supporting the measure are the Oklahoma Farm Bureau, the Oklahoma Cattlemen’s Association and Oklahoma Pork Council.

“Michael Kelsey, executive vice president of the Oklahoma Cattlemen’s Association, said the measure is needed to prevent out-of-state special-interest groups from dictating animal welfare practices. Many have cited the efforts of the Humane Society of the United States, which opposes the measure.

“Supporters of the measure say other states have passed laws dictating cage sizes for animals, such as sows and chickens, which caused prices to increase.”

The article added that, “Kelsey and [Roy Lee Lindsey, Oklahoma Pork Council executive director] framed the issue as one of consumer choice. Consumers should be the ones who decide whether they will pay more for cage-free eggs, Lindsey said.”

Recall that “right to farm” issues have also surfaced in Nebraska, Missouri and North Dakota.

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Organic Farm is Seeking $210,000 From a Neighboring Dairy

Last week, the Associated Press reported that, “.

“The Oregonian/OregonLive reports that a lawsuit filed by Simington Gardens claims they had to throw out contaminated winter squash and leafy greens and to shut down the field for four months because of the cows from Rock Ridge Farms…[A]ccording to court documents, cows from Rock Ridge escaped their gated enclosure in April 2014. After several hours they were wrangled back to the dairy, but Simington Gardens says the damage was already done.

“Oregon Tilth organic policies prohibit the use of raw manure on plants intended for eating.”

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Homeownership Rate, Lowest Since 1965

Jeffrey Sparshott reported on Friday at The Wall Street Journal Online that, “The U.S. homeownership rate fell to the lowest level in more than 50 years in the second quarter of 2016, a reflection of the lingering effects of the housing bust, financial hurdles to buying and shifting demographics across the country.

“But the bigger picture also suggests more Americans are gaining the confidence to strike out on their own, albeit as renters rather than buyers.

“The homeownership rate, the proportion of households that own their home, fell to 62.9%, half a percentage point lower than 2015’s second quarter and 0.6 percentage point lower than the first quarter of 2016, the Census Bureau said Thursday. That was the lowest figure since 1965.”

The Journal article noted that, “There are many ways to interpret the numbers. Part of the story is the catastrophic housing market collapse, which was especially severe for Generation X—those born from 1965 to 1984.

“Younger households, meantime, struggle to save amid student debt, growing rents and sluggish wages, and face a limited supply of starter homes. Indeed, the homeownership rate for 18-to-35-year-olds slipped to 34.1% in the quarter, the lowest level in records dating to 1994.

“At 77.9%, the homeownership rate was highest for those 65 years and over.”

Mr. Sparshott added that, “Down the road, many renters will likely look to become buyers, spurring a housing market that already appears constrained by rising prices and limited home inventories.”

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President Obama Signs GMO Labeling Bill Into Law

AP writer Mary Clare Jalonick reported on Friday that, “President Barack Obama has signed into law a bill that will require labeling of genetically modified ingredients for the first time.

“The legislation passed by Congress two weeks ago will require most food packages to carry a text label, a symbol or an electronic code readable by smartphone that indicates whether the food contains genetically modified organisms, or GMOs.

“The Agriculture Department has two years to write the rules, which will pre-empt a Vermont law that kicked in earlier this month.”

Ms. Jalonick explained that, “While there is little scientific concern about the safety of those GMOs on the market, advocates for labeling argue that not enough is known about their risks and people want to know what’s in their food.”

The AP article added that, “The food industry says 75 percent to 80 percent of foods contain genetically modified ingredients — most of those corn and soy-based. The Food and Drug Administration says they are safe to eat.”

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Hog Prices Hit Three Month Low

Kelsey Gee reported yesterday at The Wall Street Journal Online that, “U.S. hog futures extended their steep fall on Thursday, ending at a fresh three-month low as a steady uptick in hog supplies coincides with a drop in pork exports.

“Lean-hog futures for August declined 2.825 cents, or 3.9%, to 68.85 cents a pound on the Chicago Mercantile Exchange, the lowest level since April 14. Most-active October futures dropped 1.85 cents to 59.20 cents a pound.

“The hog market has fallen 17% in the last month as pork production has picked up throughout the month. Farmers across the country are raising more hogs and weights remain historically heavy, due in part to back-to-back years of large corn crops, which have made it relatively inexpensive to feed hogs, cattle and chickens.”

Ms. Gee explained that, “Strong export demand from China had made the $8 billion hog futures market one of the top-performing commodities through the first half of the year. But domestic and export demand for red meat has turned lukewarm as the stronger U.S. dollar has crimped buying interest from would-be buyers in July.

“Demand also has slowed among U.S. consumers, who typically opt for lighter fare during the hottest period of the year and eat less bacon, sausages and pork chops.”

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Ag Lenders Helping Producers Restructure Debt– Commodity Prices Remain Top Challenge

A news release earlier this week from AgriBank indicated that, “A new poll of senior leaders from Midwest Farm Credit lenders shows commodity prices as the greatest challenge facing their customers. Farm Credit lenders are responding to this by providing services to restructure the financial situations of their customers. In addition, in a new AgriThought report, Jerry Lehnertz, senior vice president of Credit at AgriBank, examines the challenging farm economy and how lenders are helping farmers navigate it.

“The poll’s results showed that 69.1 percent of senior credit and risk officers from the 17 Farm Credit Associations in the AgriBank District selected commodity prices as the top challenge. The next biggest challenges were input costs, credit availability and adverse weather effects.

“When asked about the support they are providing to help farmers face these challenges, 86.7 percent said rebalancing borrower debt to bolster working capital and/or reduce principal payment requirements and 73.3 percent said refinancing credit to take advantage of current interest rates. Both answers reflect the changing financial landscape for commodity prices and how lenders are working with customers to help them maintain their financial health. Other responses included consulting on crop insurance and other risk management solutions (80 percent), counseling regarding future operating plans (63.3 percent), and marketing and hedging strategies (50 percent).”

Recall that a recent paper from the Federal Reserve Bank of Kansas City explored farm financial issues in greater detail, a summary of that report is available here.

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Farm to Table for Schools

Arabella Stickels reported yesterday at the Poughkeepsie (New York) Journal Online that, “Farm to table has become a catchphrase for privileged foodies. When it comes to schools, though, farm to table is more democratic and gives every kid access to healthy, local food — as well as a hands-on education.

“According to a recent report by the USDA, farm-to-school programs have grown rapidly in the past few years, now involving more than 23 million schoolchildren. This is vital considering childhood obesity in the U.S. has more than doubled in the past 30 years — a devastating statistic.

“In Beacon — with approximately 50 percent of school-children on free or reduce-price lunches — the farm-to-school program is about to embark upon its fourth year. The program is seeing a tremendous response from the schoolchildren, thanks in part to the passion and dedication of the all-women farmer team at Common Ground Farm, a non-profit farm project in Wappingers Falls.”

The article noted that, “Sember Weinman, Common Ground Farm’s education director said, ‘At the core of the program is the emphasis on hands-on experiential activities.’ She said that as well as eating Common Ground Farm salads and vegetables in the school cafeteria, the children cook seasonal dishes through their Chef in the Classroom program and go on field trips to Common Ground Farm, where they see the farmers in action and harvest and cook the food they pick. Each elementary school also has its own school garden managed by Hudson Valley Seed.”

Yesterday’s article added that, “This is just the beginning of Common Ground Farm’s plans for a farm-to-institution program. Ben Giardullo, president of the Board of Directors at Common Ground Farm, said the non-profit organization is uniquely positioned to grow its capacity with approximately 100 acres of available land at Stony Kill, where it already leases 9 acres. As well as expanding within Beacon School District, he hopes that — with the right funding — in the next three to five years the program will begin distribution to schools in Newburgh and Poughkeepsie, and potentially other institutions, such as local colleges, hospitals and prisons.”

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