Now that Thanksgiving is behind us and the harvest season is wrapping up we will all start to reflect on this past year. With that, I would like to recap the recent ABA National Agricultural Bankers Conference. Titled The Next Cycle, the conference was held in Milwaukee in early November. Wisconsin was well represented with over 70 bankers at this year's conference! Sunday evening officially started the conference with a welcome reception where bankers mingled and networked for the first time.
Monday morning kicked off with the official welcome by the Conference Chairman Edward Coates and opening remarks by ABA Chairman Kenneth Burgess Jr., ABA President & CEO Rob Nichols, and WBA's very own Daryll Lund. The first speaker was John Barlow, sharing his insight from surveys that he conducts on banking. I found it interesting that 12% of customers change banks because of service. He also indicated that his survey found that customers expect a return phone call within 1.7 hours, a return email within 2.7 hours, and a loan response by the fourth day. There were also many good morning and afternoon breakout sessions over the course of the conference. I heard many good comments about the "New Ag Banker Track" sessions being offered. Even seasoned ag lenders found them informative. Eric Snodgrass from the University of Illinois gave his take on what the weather may be like both here and in South America. He encouraged us to watch La Niña and its effects on South America. He also told us to keep an eye on March weather in Texas through Nebraska and the southeastern U.S. because that is where a drought usually develops.
An excellent panel in the afternoon discussed land values. Many ideas were shared, from tax policy effects to changes in crop insurance to trade policy. My general impression was that even though many things could influence prices, there is some short-term downside of roughly 10%, but the areas with quality water and soil are still showing strong interest and price. Long-term they are bullish land prices. The comment was: "What are people going to eat 15 years from now?"
Monday finished with Dr. Barry Flinchbaugh giving us his perspective on present ag policy, the new Farm Bill, and how the new administration may affect it. He feels Secretary Perdue was a good pick and the President would be wise to listen to him. He also believes that there is good leadership on the Ag committees in both the Senate and House... "if Party leadership keeps their noses out of it!" He does not think there will be any big changes in the new Farm Bill. It will maintain flat funding with some money being moved among the different titles. Based on the partisan political climate in Washington, "real change is going to be down the road," according to Dr. Flinchbaugh.
Day two started with the popular Outlook Sessions for Commodities. The outlooks for beef, dairy, grains, pork, and other livestock, and specialty crops were presented. Dr. Mark Stephenson from UW-Madison shared that he anticipates 2018 Class III dairy price will be down $.65 per CWT with the All Milk price down $1 per CWT compared to the 2017 prices. Comments about the other commodities were that while beef and pork had some profitability projected in 2018, our ability to export is the major driver of profit across all commodities. Mary Kay Thatcher discussed issues of the 2018 Farm Bill. While the leaders of the House and Senate Ag committees want to get it done, limited money and how it will be distributed will be an issue. With not as many moderates from either party, the leaders will have to "walk a fine line to get it done!" Mary Kay did feel that crop insurance will be attacked during discussions. She thinks that dairy could get some changes that would help the producers with production up to 5 million pounds. A panel of economists moderated by U.S. Farm Report host Tyne Morgan discussed the U.S. Ag economy. They felt that while demand and expenses are up there is just too much supply and that will take time to work through. Ag trade, but also trade in general, will be crucial in stabilizing prices. They felt that producers needed to be nimble and quick to capitalize. One of the economists commented, "restraint is a good thing going forward."
Wednesday was the wrap-up day for the conference. Tim Bergstrom from Bergstrom Automotive Group in Neenah shared with us how his 1,600 employees deliver "Outstanding Guest Experiences." Each day should start with "finding ways to add value one guest at a time." At the end of the day, we all need to "humanize the experience!" according to Tim. Dr. David Kohl, marking his 40th consecutive year at the conference, gave us a fast-paced, informative session on "lessons for the next cycle." He reinforced and added detail to what many of the speakers in the conference had presented. The ending was a powerful message about friendship and perseverance presented by Justin Skeesuck and Patrick Gray. I encourage everyone to google their story "I'll Push You."
I know three days is a big commitment to attend a conference but the opportunity to network with ag bankers from across the country cannot be understated. This networking opportunity combined with the speakers, panels, and information is something that you can take back to your bank and put to use immediately. So whether you are a new ag banker or someone that has been around a while I would encourage you to mark your calendar for next year's conference: November 11-14 in Omaha, Nebraska.
Esser is vice president at Peoples State Bank, Prairie du Chien.