Farming on any scale much larger than a backyard garden – even a big garden for that matter – is a business and as such it must turn a profit at the end of the day to survive, if not prosper. It doesn’t matter if you are growing corn or tomatoes. This may seem like clear logic, but in truth most urbanites don’t understand the complexities of how food is grown, processed, packaged, and transported to their door.
In our society we will spend ludicrous sums on money on things like cars, cell phones, or even a cup of trendy coffee, yet we continue to demand access to all the bounty Mother Nature has to offer at discount prices.
It is a modern miracle that the largest consumptive offenders on the planet – Americans – also have the cheapest food supply on terra firma. We spend less than 10% of our disposable income on actual food items compared to other developed nations that spend as much as 15% to 50% of what they earn to put food on the table.
There are numerous factors that make this access to cheap and abundant food possible including a wildly productive agricultural core that produces key crops like wheat, corn, and soybeans. These staple crops provide the very foundation of the “real” food pyramid. These are crops that we have learned to grow fairly predictably on a large scale even when Mother Nature hits us with challenging weather. In the worst-case scenario when weather, insects or disease reduces the size of these crops we have a certain amount in reserve.
However, with a growing emphasis on more fruits and vegetable in our diet, there are also those calling for more and more taxpayers dollars to shift from existing farm programs to encourage and expand farmers markets and produce production. Striking a reasonable balance won’t be easy but it will be critical.
While many produce items have a shelf life of weeks or months at best, corn, soybeans and wheat can be transported more readily and stored for years. The authors of the original farm bill understood this and chose to put their emphasis and limited budget into programs that help growers of these keystone crops make it through tough times.
Times have changed and the farm bill is antiquated in many ways, but the importance of these key crops has not waned. The farm bill in the U.S. is not a perfect piece of legislation, few are that have become this big and cumbersome.
But today’s “farm bill” is a misnomer since the lion’s share of the expenditures go to social programs like women, infant and children, school lunches, food stamps and even forestry. Yet critics like to cultivate the illusion that it all goes to farmers.
As we continue to analyze and discuss these consumer support programs – yes, it is a consumer program that helps guarantees you the aforementioned cheap food over the long haul – it is important we do a little homework before making wholesale changes.
In the interim keep this in mind; if we stopped growing green beans or carrots tomorrow the world would not end. But if we see big reductions in crops like corn, soybeans or wheat the loss of essential oils, protein and other precious calories would change the food universe as you know it. Likely wouldn’t do our economy or our balance of trade much good either.
Eight Republican Senators sent a letter to U.S. Department of Agriculture Secretary Tom Vilsack today “urging him to refrain from using rhetoric that unfairly attacks the farmers and ranchers who form the foundation of America’s rural economy.” Earlier this month, Reuters reported comments from the Secretary indicating that the Obama administration’s plan to redirect subsidy payments for large farmers into nutrition programs is a choice between 30 million children or 90,000 farmers.
In the letter, Ranking Republican Member of the Senate Agriculture Committee Saxby Chambliss (R-Ga.) and the other senators told Vilsack that “Congress can reauthorize the school nutrition programs, provide adequate funding to meet the urgent needs of our children, while at the same time maintain the support promised in the 2008 farm bill to U.S. production agriculture.” They added the USDA has “responsibility for a wide variety of interests and should be able to advocate for one without vilifying another.”
Vilsack’s comments also came up last week when the board of the National Corn Growers Association met with him in Washington to discuss a number of issues.
“We let the secretary know that we hoped in the future the department would not pit one set of stakeholders against another,” said NCGA Chairman Ron Litterer. “We all need to work together.”
NCGA President Bob Dickey said they appreciated the opportunity to sit down with the Secretary. “It was a productive meeting that included some frank talk and ended with a strong commitment by the secretary and the board to work together in the future,” said Dickey.
Nearly 40 agricultural and commodity groups wrote to members of the House and Senate Agriculture and Budget Committees telling them to leave the farm safety net alone.
The organizations expressed “strong opposition” to the more than $16 billion in cuts to the farm safety net proposed in President Barack Obama’s 2010 budget saying that the cuts “threaten, once again, to change the rules midstream on American farm and ranch families.”
The proposed cuts come before the Farm Bill is even fully implemented and at a time when producers are struggling to understand and comply with confusing, costly and unduly burdensome payment and eligibility rule changes already being imposed that far exceed what the Farm Bill required, the Congress intended, and producers anticipated. The proposed budget cuts totally overlook the fact that producers and lenders alike have made long-term business decisions based upon the commitments made by Congress in the five-year Farm Bill and, thus, will exacerbate the current credit crisis.
Most troubling, far from targeting large agribusinesses that do not need assistance, the proposed cuts would strike at the economic heart of full-time farm families, of every sized operation, in the midst of the worst economic downturn since the Great Depression and at a time when net farm income is projected to be down 20%, threatening the viability of hundreds of thousands of family-owned farms and ranches and further undermining the U.S. economy.
Pretty much every major ag organization in the country signed on to the letter, including American Farm Bureau, National Farmers Union, National Corn Growers, American Soybean Association, etc.
See the letter here.
Everyone at Commodity Classic this year seemed to be impressed that attendance was as good or better than ever.
“As I understand it, we are either right at the record or over it, so that is phenomenal,” said National Corn Growers Association CEO Rick Tolman. Unofficial numbers I heard were about 4500 total registration with 1500 of those actual corn, soybean, wheat and sorghum farmers.
The state of the ethanol industry was a major focus at the meeting, as well as the state of the livestock industry – both major concerns for corn growers since they represent two of the biggest markets for the commodity. Tolman says they are working hard to improve their relationship with the livestock industry which has been strained in the past year over biofuels.
NCGA is also working with the ethanol industry on two important issues that could adversely impact future production – indirect land use and higher blends. “The indirect land use issue is one that by statute the EPA has to look at in the Renewable Fuels Standard,” Rick says. “Personally, I think its a ridiculous concept and doesn’t make any sense at all, however it is in law, so EPA has to look at it.” Regarding both issues, Rick believes sound science will eventually win out.
Concerns about potential changes to the 2008 Farm Bill surfaced at Commodity Classic this week, as the Obama administration unveiled its budget proposal which calls for cuts in farm program spending. “The farm bill is a five year program and we just went through a whole two years of discussions to get that done and finally we get it signed and it hasn’t even been implemented yet and they’re talking about changing it,” Tolman said. “That’s a principal I think is wrong.”
A diverse coalition of 34 business, agriculture and environmental groups, including the National Corn Growers Association, is asking Congressional leaders to support an economic recovery package that provides strong funding for agriculture-based, clean energy development programs.
The National 25x’25 Steering Committee and other renewable energy advocacy groups outlined a three part recommendation in a letter to Congressional leaders this week. The letter recommends including at least $1.2 billion each year in mandatory supplemental appropriations for important Farm Bill Energy Title programs; restructuring and extending the federal Production Tax Credits (PTC) for renewable energy, cellulosic biofuels, and biomass for five years; and extending and expanding successful clean renewable energy and conservation bond programs which provide PTC-like incentives for electric cooperatives, public power, and municipalities to build new renewable energy facilities and invest in energy efficiency.
“Our nation’s agriculture and forestry industries can not only provide a good portion of our overall energy supply, but also a new green energy future that will stimulate and reinvigorate our economy,” said Bart Ruth, chairman of the 25x’25 policy committee. “A small investment in rural America and clean, green energy development has the potential to provide a new economic foundation for the entire country.”
The coalition is largely made up of agricultural organizations, but also includes such groups as the National Wildlife Federation (NWF) and the Environmental Law & Policy Center.
Agriculture Secretary Ed Schafer expressed some frustration about implementing the ACRE program included in the 2008 Farm Bill and disappointment with how Congress is handling the issue during a question and answer session at the Association of Equipment Manufacturers AgExecutive forum this week in St. Louis.
“But we will make this decision here if not the end of this week, the beginning of next week, and get the numbers out so producers know what’s going on when it comes to planting decisions,” Schafer said. “I’m leaning to a program using the ‘07-08 numbers that Congress committed to, but we have another issue getting it through the Office of Management and Budget.”
Speaking to members of the press later, Schafer said this has been a very thorny issue with a lot of pressure financially on both sides to put the program in place and trying to find the proper place for the potential expenditure for taxpayers has been difficult. “This program was scored in a certain manner that was supposed to save taxpayers money,” Schafer said. “I think Congress, in their infinite wisdom, looked at commodity crop prices continuing to go up. If we use an ‘07-08 baseline number based on current conditions today, the guaranteed price for corn would be $4.88. With corn closing in the low $4 range this week, that would mean the cost of this program would go up dramatically.”
Schafer says the major question is when the baseline date will be. “While the CBO scored this bill for ‘07-08, they used a baseline from last April,” Schafer said. He believes that was the intent of Congress, but he says the intent was also “to save us $250 million, not to spend an extra billion.”
Listen to Schafer’s comments on ACRE from both his Q&A and the press availability here:
The National Corn Growers Association has released the answers it received from the presidential candidates on issues important to agriculture. It is important to note that NCGA is a nonpartisan, grassroots organization that does not endorse candidates for any political office but only provides information to grower-members so they can make informed decisions.
That being said, growers should read all of the candidates responses to the issues and make up their minds for themselves. They will find some very stark differences between the two candidates on issues such as the farm bill and ethanol, for example.
On the farm bill, Senator Obama says he supports “a robust safety net that targets assistance appropriately and provides farmers with risk mitigation tools that protect them from weather and market conditions that are beyond their control. This includes traditional farm programs, crop insurance, and disaster assistance.”
Senator McCain supports a risk management program for agriculture that reflects the realities of the global marketplace for food, fuel and fiber in the 21st century. However, he says he “will oppose subsidies, which distort markets, artificially raise prices for consumers, and interfere with America’s ability to negotiate with our international trading partners to the detriment of the entire agriculture community.”
Similarly, McCain’s position on ethanol states, “I do not support the current system of tariffs, subsidies and mandates. Rather, as a country, we must focus on stimulating end-user demand for renewable energy and creating a consistent regulatory and tax framework that encourages investment in research, domestic refining capacity, and distribution systems to promote energy independence.”
Obama on ethanol: “I am a proud supporter of the Renewable Fuels Standard and tax incentives for biofuels. I’ll invest $150 billion over the next ten years in our green energy sector, enhancing farmer profitability, injecting capital into rural economies, and creating up to 5 million new jobs in the process – jobs that pay well and can’t be outsourced.”
These positions are likely going to make it a tough choice for Republican farmers this November.
Corn growers from around the country have been in the nation’s capitol this week for the biannual Corn Congress meeting of the National Corn Growers Association.
In addition to setting organization policy, the growers have been electing new members and leaders and visiting with lawmakers. NCGA President Ron Litterer presented Senator Sherrod Brown (D-OH) with the President’s Award this year for his leadership and commitment to reform in the Food, Conservation and Energy Act of 2008. “NCGA cannot thank him enough for helping to take farm policy to a new level by introducing the Average Crop Revenue Election program,” said Litterer.
Wednesday evening, the corn growers met with Speaker of the House Nancy Pelosi at the annual Capitol CornFest reception Wednesday evening on Capitol Hill. In conversations at the reception, she thanked farmers for their strong support of the Farm Bill and the Renewable Fuels Standard (RFS) in last year’s historic energy bill. She is pictured here with NCGA chairman Ken McCauley, NCGA president Ron Litterer and Corn Board member Theresa Schmalshof.
The highly anticipated analysis of certain provisions of the new farm bill by the Food and Agricultural Policy Research Institute at the University of Missouri–Columbia, better known as FAPRI, was released this week.
The report provides preliminary analysis of impacts of certain provisions of the 2008 Food, Conservation and Energy Act, including the ACRE program. The report found that, besides ACRE, most of the selected provisions of the law would have only modest impacts on commodity markets, farm program expenditures and consumer food prices.
The ACRE program could have significant effects on producer income and taxpayer costs. On a crop year basis, the program increases net farm program payments by an average of more than $1 billion per year and the potential expenditures are much larger. Given program rules and estimated payments, the ACRE program appears much more likely to appeal to producers of feed grains, wheat and soybeans than to producers of cotton, rice and peanuts. Thus, the program is more likely to be attractive to producers in
northern states than in southern states.
The report also looked at the impact of extending the ethanol specific tariff and reducing the ethanol tax credit and found that “extending the $0.54 per gallon specific tariff on ethanol imports for two more years results in lower ethanol imports and slightly higher prices for ethanol and corn. In contrast, reducing the ethanol tax credit to $0.45 per gallon from the current $0.51 per gallon would tend to reduce ethanol and corn producer prices. The tariff effect is slightly larger than the tax credit effect, so average corn and ethanol prices increase slightly.”
Read the entire report here.
With apologies to the Temptations, I thought of the Farm Bill saga this week when I happened to hear that old tune “Ball of Confusion” on the radio yesterday. So, I came up with my own lyrics – somebody call Rush Limbaugh… Read the original lyrics here.
Titles left out,
Titles left in,
All because of a spacey clerk’s sin
Vote, vote, vote, but it’s still not done.
Aye after aye, it passed with ease,
Vote for the farm bill and we’ll be free
Rap on, Congress, rap on
The only person talking about heed thy budget is the president
And it seems
Everybody’s interested in passing it
But the White House resident
Bill of confusion, oh yeah
That’s what the farm bill is today, hey hey
The price of food is at an all time high
Now they are saying that ethanol is why
Planting is going into summertime, and
The bill’s not done
Resolutions, quick solutions to control the voting roll
Shoot the bill back again
So Bush can use his veto pen
Politicians say more taxes will solve everything
And the bill’s still not done
So, round and around and around we go
Where the bill’s headed, nobody knows
Oh, great googamooga, can’t you hear me talking to you
Just a bill of confusion, oh yeah
That’s what the farm bill is today, hey hey!!!
Farming on any scale much larger than a backyard garden – even a big garden for that matter – is a business and as such it must turn a profit at the end of the day to survive, if not prosper. It doesn’t matter if you are growing corn or tomatoes. This may seem like clear logic, but in truth most urbanites don’t understand the complexities of how food is grown, processed, packaged, and transported to their door.
Vilsack’s comments also came up last week when the board of the National Corn Growers Association 
The organizations expressed “strong opposition” to the more than $16 billion in cuts to the farm safety net proposed in President Barack Obama’s 2010 budget saying that the cuts “threaten, once again, to change the rules midstream on American farm and ranch families.” 
“As I understand it, we are either right at the record or over it, so that is phenomenal,” said National Corn Growers Association CEO Rick Tolman. Unofficial numbers I heard were about 4500 total registration with 1500 of those actual corn, soybean, wheat and sorghum farmers. 
The 
“But we will make this decision here if not the end of this week, the beginning of next week, and get the numbers out so producers know what’s going on when it comes to planting decisions,” Schafer said. “I’m leaning to a program using the ‘07-08 numbers that Congress committed to, but we have another issue getting it through the Office of Management and Budget.”
That being said, growers should 
In addition to setting organization policy, the growers have been electing new members and leaders and visiting with lawmakers. NCGA President Ron Litterer presented Senator Sherrod Brown (D-OH) with the President’s Award this year for his leadership and commitment to reform in the Food, Conservation and Energy Act of 2008. “NCGA cannot thank him enough for helping to take farm policy to a new level by introducing the Average Crop Revenue Election program,” said Litterer.
Wednesday evening, the corn growers met with Speaker of the House Nancy Pelosi at the annual Capitol CornFest reception Wednesday evening on Capitol Hill. In conversations at the reception, she thanked farmers for their strong support of the Farm Bill and the Renewable Fuels Standard (RFS) in last year’s historic energy bill. She is pictured here with NCGA chairman Ken McCauley, NCGA president Ron Litterer and Corn Board member Theresa Schmalshof.
The report provides preliminary analysis of impacts of certain provisions of the 2008 Food, Conservation and Energy Act, including the ACRE program. The report found that, besides ACRE, most of the selected provisions of the law would have only modest impacts on commodity markets, farm program expenditures and consumer food prices.
With apologies to the Temptations, I thought of the Farm Bill saga this week when I happened to hear that old tune “Ball of Confusion” on the radio yesterday. So, I came up with my own lyrics – somebody call Rush Limbaugh…