Farm Income Falling Again in 17
According to USDA anticipates an 8.7 percent decline in net farm income in the next year, which brings net farm income to $62.3 billion. If predictions hold true, this would be the fourth consecutive decline since the peak in 2013. According to the department, it would be the worst performance for the U.S. farm economy since 2002. The next scheduled forecast release is August 30, 2017.
“Lubbock County and other South Plains producers continue to face stressful times due to depressed commodity prices and a reduced safety net,” said Dr. Jackie Smith, AgriLife Extension economist at Lubbock. “Even though 2016 was more favorable than the previous two years, producers will still be looking for and considering decisions that could cut costs or improve yields.
Farmers Union Addresses Trade Deficit
The U.S. Commerce Department announced this week that the U.S. trade deficit grew to $502 billion in 2016, marking its highest level in four years. National Farmers Union (NFU) President Roger Johnson says “Yet again, our nation’s trade deficit soared to more than half a trillion dollars, representing a direct 2.7 percent drag on our economy in 2016. Clearly, the deeply flawed trade agenda that our trade negotiators have continued to employ is failing family farmers, ranchers, rural communities, and the overall U.S. economy.”
NFU is urging the Trump Administration to reset the nation’s trade agenda in a manner that addresses the “massive trade deficit, expands the agricultural trade surplus and protects U.S. sovereignty, while maintaining positive relationships with our trading partners.”
Ag Economists Warn of Impending Disaster
America’s farmers and ranchers are facing one of the worst downturns in recent history with a 46 percent drop in net farm income and an additional 9 percent decline expected this year. “No one saw this large and sustained drop coming,” explained Dr. Joe Outlaw of the Agricultural and Food Policy Center at Texas A&M University, during a panel discussion at the Southwest Ag Issues Summit this week on the depressed farm economy. “Right now the only thing producers can hope for is a blip in the market and a home run crop.” Dr. Pat Westhoff, of the Food and Agricultural Policy Research Institute of the University of Missouri and the other economist on the panel, provided a similar assessment. “Farm economics is terrible right now,” he added. “We’re not even breaking even across the country.”
And, a little farther east, the National Crop Insurance Services (NCIS) annual conference was underway with similar discussions. Dr. Mechel Paggi, an agricultural policy analyst for NCIS, kicked off the panel he was moderating by highlighting reports from the Federal Reserve about the agricultural economy with one summing it up in plain and honest terms for all of us: “things do not look good right now.” USDA Chief Economist Robert Johansson, who also addressed the crop insurance conference, noted that one in 10 U.S. farms are now considered “highly or extremely leveraged.” Delinquency rates on farm loans are on an uptick, he explained, and farm real estate debt is approaching the peak set in the early ’80s, when America was in a farm crisis.
House Ag Committee Looks at Rural Economies
As the 2014 Farm Bill is set to expire next year, Representative Mike Conaway (R-TX), Chairman of the House Agriculture Committee, has announced a Full Committee Public Hearing Wednesday (2/16/17) on the “Rural Economic Outlook: Setting the Stage for the Next Farm Bill”.
Conaway has gone on record in saying that he wants to begin writing the next farm bill this year. Speaking at the 2017 Southwest Ag Issues Summit in Fort Worth, he said “since we will be writing a farm bill this Congress we will hold fewer hearings in Washington but (are) looking forward to the coming listening sessions and are committed to passing a farm bill before the current one expires – if not before”.
The full committee will meet again on Thursday (2/16/17) to consider the “Pros and Cons of Restricting SNAP Purchases”.
House Passes Resolution Repealing Obama-Era Rule
The National Cattlemen’s Beef Association (NCBA) and the Public Lands Council (PLC) hailed U.S. House passage of a resolution that would repeal the Bureau of Land Management’s (BLM’s) Planning 2.0 Rule, calling it a “huge victory” for America’s ranchers. If the U.S. Senate also quickly passes the resolution, it would go to the White House for President Trump’s signature.
“For years, the Obama Administration ignored the concerns of ranchers and local officials and instead rammed through this massive regulatory overreach as they were being shown the door,” said Ethan Lane, Executive Director of PLC and NCBA Public Lands. “This is a huge victory for America’s cattle producers and a sign that some common sense is finally being restored in Washington.”
“Planning processes are critical to the ability of grazing permitees to operate in the West,” Lane continued. “The final rule’s shift away from multiple use, as well as its disregard for both local input and economic analysis, make it unworkable for the more than 18,000 ranchers operating on BLM-managed lands.”
NCBA and PLC have long expressed concerns about BLM’s Planning 2.0 Rule, which would represent a wholesale shift in management focus at BLM by prioritizing “social and environmental change” over ensuring multiple use of public lands, and by eliminating stakeholder and local input into the planning process.
The Obama Administration finalized the BLM Planning 2.0 Rule in December. Under the Congressional Review Act, the U.S. House and Senate have up to 60 legislative days after a new rule becomes final to approve a joint resolution of disapproval, which will fully repeal the final rule if and when the resolution becomes law.