Something I learned pretty early in my career covering agriculture: You can’t pull the wool over the eyes of farmers. And if you try to do so it’s at your own peril.
So, with the mid-term elections less than a week away we ask are these pragmatic farmers optimistic about the direction of all things ag over the past year.
Well, the answer may be a resounding NO – especially for row crow farmers and pork producers.
Last month, Purdue University and CME Group released its latest sentiment among farmers and its bad news for the White House. Farmers sentiment for September hit rock bottom for 2018 and its lowest reading since October of 2016.
The Index of Future Expectations, fell 10 points and the Index of Current Conditions fell 25 points against the August reading.
When it comes to agriculture, the White House and GOP controlled Congress has generally ticked off farmers with its all-out tariff war with China, a NAFTA reboot (now called United States, Mexico, Canada Agreement) that may prove modestly helpful to U.S. dairy producers but gives nothing of significant to corn and soybean, corn, pork and cattle producers, and failure to move a new farm bill out of conference committee before it expired on October 1.
Front and center for the POTUS is trying to batter China into submission with increased tariff pressure.
In case you have forgotten – and farmers HAVE NOT – the U.S. has slapped $253 billion in tariffs on China. For its part, the People’s Republic of China has more than been willing to play tit-for-tat with $110 billion in tariffs against the U.S. including a 25 percent levy on U. S. soybeans.
China is frantically working to source soybeans from anywhere this growing season and have announced plans to cut imports for the 2018 crop year which opened October 1 from last year’s 93.9 million tons to 83.65 million tons.
U.S. soybean farmers have lost roughly $2 a bushel. The White House – certainly with one eye on the elections – are trying to mitigate soybean producer ire with a promise to pay $1.65 a bushel on half of a farm’s production. But that won’t make soybean farmers whole.
It’s even worse for corn farmers who will receive just one-half cent a bushel.
And then in early October USDA Secretary Sonny Perdue hinted that the department’s $12 billion package to partially offset losses from the China trade war may need to be reduced in light of the updated NAFTA.
That probably did not sit well with farmers and earlier this week Purdue said USDA would stick to the original plan and allocate the full $12 billion in trade aid.
Perhaps that is partially why the White House announced recently that it is lifting a ban on summer sales of higher-ethanol blends of gasoline, in the hopes of driving down prices at the pump and increasing domestic corn usage.
Very early on, I knew it as a virtual certainty that Congress would miss its self-imposed October 1 deadline for delivering a farm bill to the president.
Back in January I blogged that a huge fight was brewing over the Supplemental Nutrition Assistance Program and farm subsidies.
Since passage of the House and Senate versions of the farm bill talks among Agriculture Committee leaders have become tense. House Ag Chairman Mike Conaway and Senate Agriculture Committee ranking member Debbie Stabanow are locked in a political death struggle over Title I which covers farm subsidies.
Stabanow opposes Conaway’s pet payout – a provision that would send roughly $500 million to cotton growers, a top Conaway constituency.
For his part Conaway absolutely despises elimination of $2 billion for rural utilities.
Some of those dollars go to pay for Stabenow pet projects including research funding for indoor farming and local and regional food production – better known as urban farming.
With the Conaway-Stabanow dustup in full swing, the farm bill conference committee has barely touched the other huge elephant in the room — SNAP.
The House bill contains new work requirements for SNAP recipients. Conaway has failed to budge an inch despite the obvious fact that the policy can’t pass in the Senate. The votes are not there.
House ag members have gone home till the lame-duck session and it’s becoming increasingly clear that Congress will have to pass a farm bill extension, creating uncertainty among farmers for the 2019 growing season.
Let’s not mince words. Federal policy hasn’t been kind to farmers in 2018. But next week, we’ll find out if farmers are willing to be forgiving at the ballot box particularly in governor and state legislative races.