Excerpts from the report: In this session on applied agricultural economics we are interested in the big picture view of the economic environment that affects the profitability and solvency of the farm or ranch that is beyond the control of the operator. The level of commodity prices, interest rates, the costs of production inputs, the value of land and equipment, changes in consumer preferences, and government agricultural programs are not controlled by the operator. However, they all have a very large impact on farm or ranch profitability, and ultimately may determine if the operation can survive financially in the long run. Just as a rising tide raises all the ships in the harbor, irrespective of the skill of the ship’s captain, so the agricultural economic environment either makes it easier or harder for farm and ranch managers to avoid the rocks of financial failure. The topics we will discuss in this section on agricultural economics include: how U.S. agricultural commodities fit into the world supply and demand picture, financial management, commodity price analysis, marketing, production costs, asset values, and how environmental policies affect borrowers and lenders.