Growers lobby for a U.S. farm bill with a robust crop insurance program and improved risk management programs
ANAHEIM, Calif. — The U.S. farm sector is on the brink of a full-fledged crisis, say commodity groups.
Kevin Skunes, president of the National Corn Growers Association, said the average Iowa farmer in 1993 was paying $74 per acre in machinery costs, $113 per acre in input costs and $92 per acre in land costs.
The average corn price was $2.25 per bushel and average yields were 133 bu. per acre, resulting in a net profit of $20 per acre.
The same grower in 2017 shelled out $117 per acre in machinery costs, $250 per acre for inputs and $230 per acre for land.
The average corn price was $3.36 per bu. and the average yield was 177 bu. per acre, delivering a net loss of $10 per acre.
“Time is running out to avoid a significant farm crisis,” Skunes told reporters attending the 2018 Commodity Classic conference.
He is struggling to stay in business after four years of low corn prices and there is no relief on the horizon with the U.S. Department of Agriculture forecasting a 2018 average corn price of $3.40 per bu.
“The outlook remains uncertain at best and bleak at worst,” said Skunes.
That is why the corn growers are lobbying for a 2018 U.S. farm bill with a robust crop insurance program, improved risk management programs and enhanced conservation and research programs.
Ron Moore, chair of the American Soybean Association, said crop prices are down 40 percent and net farm income is down 50 percent since 2013.
“It’s getting hard for farmers, regardless of their age or experience, to secure funding for their operations,” he said.
Moore said farm bills were created for times exactly like this and he wants a new five-year bill in place by the time the old one expires in September 2018.
“The rocky farm economy underscores the need for a strong farm safety net,” he said.
“We can’t afford dramatic cuts anywhere in the farm bill.”
In addition to robust crop insurance and price risk insurance programs, the group is pushing for doubling export development program funding.
Gordon Stoner, past-president of NAWG, said crop insurance is the top priority for wheat farmers because wheat is often grown in the more arid regions of the country.
“Without crop insurance, it would be a tough row for some of our farmers,” he said.
U.S. President Donald Trump released a proposed budget in February that would cut crop insurance funding by $26 billion over 10 years.
Moore was asked if that was a big concern. He responded that he has been told by the chairs of the Senate and House agriculture committees that they are designing a bill that will contain evolutionary rather than revolutionary change.
U.S. Agriculture Secretary Sonny Perdue said he doesn’t write the farm bill but he does provide advice to Congress.
“It must help American farmers weather times of economic crisis and stress without distorting markets,” he told farmers attending the Commodity Classic.
“I think we can all agree that it doesn’t help prices when producers start planting for the program and not for the market.”
Perdue said farmer resilience is being tested by falling commodity prices, rising costs, droughts, flooding and wild fires.
The USDA forecasts a further drop in farm income in 2018 of more than six percent.
“There is no sugar coating the fact that we are facing some pretty serious challenges today,” said Perdue.
“While times are tough, ladies and gentlemen, I know that American farmers and ranchers are tougher.”