What Should We Plan For After Two Years of Hard Times on Farmers?
By Mike Ferguson
(St. Charles, MO) – First it was flooding and then an extended drought.
While news reports occasionally profiled the impact the weather has had on Missouri farmers these last two years, it’s likely that we’ll all feel the impact in the coming months.
That’s because lowered crop production generally means higher food prices. That’s a result of basic supply and demand.
In a new “Missouri Viewpoints”, the Missouri Farm Bureau’s Kelly Smith says that impact isn’t limited to corn, beans and wheat.
“The impact has probably been the most major on our livestock farmers across the state. I’m sure consumers have seen meat prices go up in the grocery store and that’s because, as feed prices have gone up – because the drought has affected corn and soybean production – as those costs have risen, the livestock industry has cut back in their numbers.”
In other words, many livestock farmers sent their herds to slaughter earlier than normal last year, resulting in a lower supply of meat this year. That happened when water sources literally dried up on many farms as the drought progressed in 2012.
That lower supply affects mostly beef. Smith says there may be more poultry in the market this year, possibly leading to lowered turkey and chicken prices.
Smith says another challenge facing Missouri farmers doesn’t come from the weather, it comes from Washington.
“There is not farm bill to start this year out so it’s kind of like starting out playing Monopoly…with no rules, basically.”
The Missouri Grocers Association’s State Director, Dan Shaul, says they are anticipating higher food costs. Among the ways grocers are planning to keep costs low could mean a boost to Missouri farmers this year.
“We look at all different types of ways of sourcing products, using product that’s grown here in Missouri so we can reduce the transportation cost.”
Shaul gives an example of the cost that can result from stocking the shelves with food from areas far from Missouri, both in the US and internationally.
“A lot of times, it’ll cost us the same thing in fuel as it does for product.”
Shaul also expressed concern about the lack of a farm bill from Congress.
Both say about 80% of a normal farm bill funds nutrition programs, including welfare programs like SNAP and WIC, which are significant revenue sources at the grocery stores’ cash registers.
Much of the other 20% funds agriculture subsidies and price guarantees. At this point, Congress hasn’t approved a new, long term plan for a farm bill that businesses, especially farmers, can build in to their long-term plans.
On the web:
Missouri Farm Bureau: http://www.mofb.org/
Missouri Grocers Association: http://www.missourigrocers.com/