Nebraska Bill Would Let Farmers Work on Their Own Tractors

Nicholas Bergin reported earlier this week at the Lincoln Journal Star Online that, “Mick Minchow’s tractors are marvels of modern machinery.

“They have air conditioning, guidance systems, satellite radio and more sensors than he can shake a corn cob at, all kept running by computer systems and software.

“But there’s one thing the Waverly farmer doesn’t have: the right to fix his John Deere 8235 R if it goes on the fritz.”

Mr. Bergin explained that, “Gone are the days when farmers could be their own mechanics. Just taking a peek under the metaphorical hood of the computers that run the big tractor could put Minchow in violation of the federal Digital Millennium Copyright Act.

“It’s the same for digital products from cellphones to printers to concrete crushers that rely on computer programs to run.

“Nebraska is one of four states to consider legislation that would require manufacturers to make diagnostic, service and technical information available to farmers and independent repair technicians. The others are Massachusetts, Minnesota and New York.”

The Star article pointed out that, “Proponents of Nebraska’s Fair Repair Bill say it would let farmers work on their own equipment and allow independent mechanics to help get machines running quicker;” and added that, “John Hansen, president of the state’s second largest agricultural advocacy organization, the Nebraska Farmers Union, supports the Right to Repair efforts saying farmers should have the same option to get their tractor fixed by an independent mechanic as they do when they need to get their truck fixed.”

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Overflowing Stocks, and Bright Prospects Pressure Grain Markets

Gregory Meyer reported yesterday at The Financial Times Online that, “Overflowing stocks and large prospective harvests have given grain markets a hard shove in the past month. Both corn and wheat futures have fallen about 20 per cent from recent highs in June. Last week, contracts of both grains for December 2016 delivery were the lowest since they first traded.”

The FT article noted that, “‘The market has really shifted away from thinking about the risk of a drought to now how much above trend the yield might be,’ says Darrel Good, agricultural economist at the University of Illinois.

“Anxiety rattled grain markets last spring as the world exited an extremely strong El Niño, the Pacific Ocean warming cycle.  Research by Prof Good and his colleague Scott Irwin found that a transition from El Niño to its La Niña opposite by summer, as sometimes occurs, risked reducing US corn and soyabean yields.

“But Prof Good says that, so far, conditions have reverted to neutral. ‘We really haven’t gotten into La Niña at this point, and if we do, that will come in later into the fall and probably not have much impact on the crops here,’ he says.”

Mr. Meyer also stated in his FT article that, “The summer crops will be grown on a lot of land. The USDA last month showed US farmers seeded a record 83.7m acres (33.9m hectares) of soyabeans in the spring and also increased acres of corn by 7 per cent to 94.1m acres, fourth highest ever.

“The grain outlook is also positive in other important regions such as Russia, Ukraine and the EU.”

Separately, in an update posted yesterday at the farmdoc daily blog (“Weekly Outlook: Soybean Prices Dominated By Supply Uncertainty“) Professor Good stated that, “November 2016 soybean futures traded to a high of $11.86 per bushel on June 13, $3.22 above the low reached on November 10, 2015. The price of that contract declined to $10.21 on July 8 and is currently trading near $10.65. As is typically the case this time of year, price direction will now be mostly determined by U.S. crop prospects, with the pace of consumption playing a minor role.”

The farmdoc analysis concluded by pointed out that, “While the strong pace of export sales and the domestic crush may have provided modest support for soybean prices, the major focus has been and will continue to be on U.S. weather and yield prospects. Crop condition ratings for the week ended July 3 indicated that 70 percent of the crop was rated in good or excellent condition. That compares to 63 percent rated good or excellent for the same week last year and the 30-year average of 60 percent for the same week. If maintained, current ratings would point to a U.S. average yield above the 2016 trend value of 46.1 bushels and above the USDA’s trend projection of 46.7 bushels per acre. Recent and upcoming rainfall will likely maintain high crop condition ratings for the near term. The main short term uncertainty surrounds the duration of an upcoming period of above normal temperatures for much of the soybean production area. With so much of the growing season remaining, however, yield uncertainty could persist for several more weeks. The resulting price fluctuations will provide opportunities for producers to make additional sales in the run-up to harvest.”

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As Startups Bloom Elsewhere, Best-Funded Companies Remain in the Bay Area

Christopher Mims indicated in yesterday’s Wall Street Journal that, “Clusters of high-tech startups are blooming everywhere, in cities large and small. From Denver to Washington, D.C., and Austin, Texas, to Chattanooga, Tenn., entrepreneurs are seeking greener pastures, including better quality of life and lower operating costs for their startups.

“Former AOL chief and Revolution LLC founder Steve Case calls this the ‘rise of the rest,’ and it is a real phenomenon. And yet, as fast as the rest of the country creates startups, Silicon Valley grows even faster, disrupting entire industries, from transportation to lodging, retail and media. Silicon Valley is transforming fragmented industries into unified, winner-take-all markets that reward the biggest, best-funded, most aggressive companies—which are still being built, for the most part, in Silicon Valley.

“Consider the data. According to Dow Jones VentureSource, in 1995, about 30% of all venture capital invested in the U.S. went to companies in the Bay Area. By 2015, that figure was close to 50%.”

Mr. Mims noted that, “There are several forces driving the trend. The first is proximity. The internet was supposed to erase distance. But it also created a better, more liquid market for talent and investment, making it easier for companies to find the best people, and vice versa.

“Additionally, as companies stay private longer, gigantic late-stage financing rounds are changing the nature of venture capital. Money that used to come from public markets is now funneled through VCs. Because the biggest private tech companies are disproportionately based in Silicon Valley, this skews the statistics and becomes part of the feedback loop concentrating money in the region.

“Even when companies start outside the Bay Area, they often move to take advantage of the financing climate and talent pool.”

The Journal item did point out that, “Founders in these atypical startup cities are quick to extol their virtues. Cameron Doody, and Stephen Vlahos, co-founders of Chattanooga-based moving-services company Bellhops Inc., say that they’ve been able to recruit technical talent who are burned out on the rising cost of living and declining quality of life in the Bay Area. At the same time, they don’t have to fight ‘crazy salary battles,’ says Mr. Vlahos.”

But Mr. Mims added that, “No one knows if the seemingly inexorable trend of venture capital flowing to the Bay Area will turn, so that other cities can benefit from the job creation that comes from startups. Investors like Mr. Case and [Jonathan Teo, co-founder and managing partner of San Francisco-based Binary Capital] argue that their money, expertise and help recruiting talent are what startups outside Silicon Valley need to thrive.

“The alternative, which is worth contemplating, is that the accumulation of money, power and influence in Silicon Valley continues to feed on itself until companies based there control pretty much everything. In other words, it may not be just software eating the world, but Silicon Valley eating the world.”

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U.S. House May Act Soon on GMO Labeling Measure

Christopher Doering reported on Friday at The Des Moines Register Online that, “As soon as next week, the House could consider a Senate bill requiring labeling of foods with genetically modified ingredients, the chairman of the chamber’s Agriculture Committee said Friday.

“Rep. Mike Conaway, R-Texas, said he would support the bill even though it is ‘riddled with ambiguity.’ He has sought insight from the Agriculture Department on how it would implement the law.

“‘It is my expectation that this legislation will be considered on the House floor next week, and it is my intention to support this bill,’ Conaway said.”

Mr. Doering noted that, “The House has a week to consider the measure before going on a summer recess though Labor Day. Alternately, House members could try to iron out differences between their version of the bill, approved last year, and the Senate bill.

“The Senate version would block states from implementing their own labeling rules and override Vermont’s law that went into effect July 1.”

The Register article explained that, “Under the Senate legislation, major food makers would have three options to notify consumers if a product contains GMO ingredients: words, a symbol created by the Agriculture Department, or an electronic option such as a QR code consumers could scan with a smartphone.

“Small food manufacturers could simply list websites or telephone numbers, while those defined as very small, along with restaurants, would be exempt…[T]he House version of the bill would make it optional for companies to label products with GMO ingredients and would ban states from putting in place their own labeling laws.”

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A Start-Up Goes with Full-Time Employees, Not Leaning on the “Gig Economy”

Nick Wingfield reported in the business section of Sunday’s New York Times that, “When Glenn Kelman became the chief executive of his online real estate start-up, he defied the tech industry’s conventional wisdom about how to grow.

“Instead of hiring independent contractors, he brought in full-time employees and put them on the payroll — with benefits. That decision over a decade ago made Mr. Kelman and his company, Redfin, iconoclasts in the technology world.”

The article stated that, “Many tech start-ups lean on the idea of the ‘gig economy.’ They staff up rapidly with freelancers, who are both cheaper to hire (none of the insurance, 401(k) and other expenses) and more flexible (they can work as much or as little as needed). It’s the model Uber has used to upend the taxi business.

“That model is also fueling a national debate over worker protections. Uber, with 1.1 million active drivers globally, recently agreed to settle class-action lawsuits brought by drivers in Massachusetts and California who argued that they should be classified as employees. Similar suits continue in other states.

“In a fairy-tale version of the Redfin story, the company’s bet on employees would have resulted in industry-rattling success. The truth is more complicated.”

Mr. Wingfield pointed out that, “In Redfin’s early days, prospective venture fund investors walked away, saying that betting on full-time employees was a deal killer for them. Its hiring strategy has slowed the company’s growth and contributed to what Mr. Kelman calls a ‘near-death experience’ after the 2008 economic crisis. Problems like these illustrate why tech companies prefer to use contractors if they can.”

Yesterdays article went on to say that, “Mr. Kelman argues that full-time employees allow him to offer better customer service. Redfin gives its agents salaries, health benefits, 401(k) contributions and, for the most productive ones, Redfin stock, none of which is standard for contractors. Redfin currently employs more than 1,000 agents.

“Now with his company on a stronger footing, Mr. Kelman says he believes his approach has been vindicated. He has even become an informal counselor to other tech entrepreneurs exploring a shift to employees from contractors.

“But they are still the exception. The idea of building a large work force of full-time employees, outside of core disciplines like engineering, is not part of the ethos of most companies in today’s tech industry, observers who have studied the industry say.”

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Out of New York’s Shadow, Connecticut Startup Scene Grows

Joseph De Avila reported on Friday at The Wall Street Journal Online that, “Ahmed Khattak started an ecommerce business in New Haven, eventually moving it to Seattle. By 2014, he decided he was ready for a new opportunity and a new location.

“Friends advised him to start his next company in San Francisco. Instead he choose Stamford.”

The article noted that, “Though it is home to well-known technology companies such as Priceline Group Inc. and its subsidiary Kayak.com, Connecticut’s dispersed startup community has operated in the shadows of New York and Boston for years. That is changing, founders and investors said, as greater access to funding and entrepreneurial programs are helping the state’s startup scene gain footing.

“Hugh Seaton, chief executive of Stamford-based Aquinas Training, which develops management-training software, has been working on bringing Connecticut’s entrepreneurs together.”

The Journal article pointed out that, “In New Haven, David Salinas, chief executive of design agency Digital Surgeons, is leading efforts to turn a former bus depot into a 105,000-square-foot tech hub called the District. It will be located on a 9.3-acre campus on the bank of the Mill River, complete with a beer garden and kayak launch. It is slated to open in 2017…[I]t is initiatives like those that have made Connecticut’s startup community more vibrant, said James Boyle, managing director of the Yale Entrepreneurial Institute, a program that helps students launch companies.”

Friday’s article added that, “Venture capital and private-equity groups invested $402.5 million in Connecticut startups last year, a 43% increase from the $280.5 million invested in 2006, according to Dow Jones VentureSouce.”

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NYC Initiative Tries to Foster Women-Run Startups

Anne Kadet reported on Friday at The Wall Street Journal Online that, “WE NYC is the somewhat deadly acronym for Women Entrepreneurs New York City, a lively new city initiative aimed at low-income and immigrant women business owners.

“There’s no doubt that local women lag behind the men on the startup front. New York men own 1.5 times more businesses than women and employ 3.5 times more workers. On average, men-owned businesses earn $609,000 a year compared with the $140,000 earned by women-owned enterprises.”

Ms. Kadet indicated that, “WE NYC plans to address the situation by connecting women entrepreneurs with mentors and skills-building classes.”

“The city’s plans are both modest—it aims to serve roughly 5,000 women over the next few years—and ambitious. [Gregg Bishop, the commissioner of the Department of Small Business Services] imagines the program serving as an example for cities around the globe. ‘San Francisco is thinking of replicating the model, even Paris,‘ he says.”

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Farm Data Issues

Jason Tatge, writing recently at TechCrunch Online, indicated that, “Farmers are adopting smart-sensor technologies and connected farm equipment more quickly than ever, stretching each season to eke out greater yield from finite acreage.

“This rise in so-called precision agriculture has precipitated a massive influx in unstructured ‘bushels to bytes’ farm data, creating new opportunities for an industry that has previously operated solely in the physical realm.”

Mr. Tatge explained that, “Specifically, ownership and control of agronomic and equipment data is understood to have dramatic escalating value. Which seed varieties were the most successful and where? Which plant populations performed best? Whose recommendations (e.g. nitrogen programs) outperformed their peers?”

The article stated that, “Farm data is expected to be a $20–$25 billion revenue opportunity, but we haven’t yet determined how the data can be collected, structured, stored and shared, let alone monetized.

“Today, there are no clear-cut guidelines regarding the privacy of the data, nor its ownership and control. Many different players impose contractual obligations in fine print, but few are likely to stick until there is wide-reaching agreement on what’s appropriate.”

And, Mr. Tatge also pointed out that, “There is reason to feel optimistic. Over the past several months, 37 industry participants have taken a seat at the table to contribute to the creation of the Transparency Evaluator, an important tool built to bring transparency to farm data agreements.”

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Soybean, Corn Prices Decline as Ideal Weather Conditions Unfold

Reuters writer Naveen Thukral reported yesterday that, “Chicago soybean futures were on Friday set for their biggest weekly decline since June 2014 as near-perfect U.S. weather boosted the prospects of a bumper crop.

“Corn is poised for a third week of decline as the U.S. crop thrives in friendly weather in its crucial pollination phase, while wheat is on track to suffer its fifth week of losses.

“Chicago soybean futures have lost nearly 10 percent this week, their biggest weekly fall since June 2014 as rains aid the U.S. crop and fears of dry La Nina weather pattern ease.”

The Reuters article explained that, “Corn has lost 4.5 percent this week, falling for a third consecutive week, while wheat is down more than 1 percent in its fifth week of losses.

“Corn has given up close to 20 percent in three weeks and wheat has shed more than 14 percent in five weeks.

“The U.S. corn crop is getting a boost from rains and ideal weather in its pollination phase.”

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GMO Labeling Bill Passes U.S. Senate

Reuters writer Chris Prentice reported today that, “The U.S. Senate on Thursday approved legislation that would for the first time require food to carry labels listing genetically-modified ingredients, which labeling supporters say could create loopholes for some U.S. crops.

“The Senate voted 63-30 for the bill that would display GMO contents with words, pictures or a bar code that can be scanned with smartphones. The U.S. Agriculture Department (USDA) would decide which ingredients would be considered genetically modified.

“The measure now goes to the House of Representatives, where it is expected to pass.”

The article noted that, “Drawing praise from farmers, the bill sponsored by Republican Senator Pat Roberts of Kansas and Democrat Senator Debbie Stabenow of Michigan is the latest attempt to introduce a national standard that would override state laws, including Vermont’s that some say is more stringent, and comes amid growing calls from consumers for greater transparency.”

The Reuters article pointed out that, “A nationwide standard is favored by the food industry, which says state-by-state differences could inflate costs for labeling and distribution. But mandatory GMO labeling of any kind would still be seen as a loss for Big Food, which has spent millions lobbying against it.”

And Des Moines Register writer Christopher Doering reported in today’s paper that, “Under the Senate bill, major food-makers would have three options to notify consumers if a product contains GMO ingredients: words, a symbol created by the U.S. Department of Agriculture, or an electronic option such as a QR code.

“Small food manufacturers could use websites or telephone numbers to satisfy disclosure requirements, while those defined as very small, along with restaurants, would be exempt.

“Critics have said the bill exempts many foods from the labeling standards, lacks enforcement teeth for companies that fail to comply and depends on a flawed QR code. The poor, elderly and those in rural areas may not have a smartphone to scan the QR code, or reliable internet access in their grocery store to check on the contents of foods they buy.”

Meanwhile, in a separate article, that appeared on the front page of today’s Des Moines Register, Christopher Doering reported that, “DuPont Pioneer, Monsanto and other companies working on genetically modified technologies are focusing more attention on creating foods that improve public health and provide convenience for shoppers.

“For the industry, which has weathered growing criticism for biotech crops that have helped protect farmers from pests and diseases, expanding into products such as potatoes, pineapples, tomatoes and healthier soy oils could be a way to improve its image.”

Today’s article added that, “Monsanto has not only delved into healthier soybeans, but also scores of fruits and vegetables using traditional breeding.

“Not all its work has proved to be a hit with the consumer. A broccoli marketed since 2012 that claimed to maintain antioxidant levels was pulled last year because its grower was unable to produce enough of the product with the same consistency to be profitable.”

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