By Cheryl Stubbendieck
Vice President of Public Relations
Nebraska Farm Bureau Federation
It is a good thing that hope springs eternal: Farmers need at least one thing they can count on right now.
It is never easy to make a living in farming, but sometimes, like now, it seems nearly impossible and not worth the considerable effort.
--The last two years have seen some record-low prices for crops and livestock, and while livestock prices are up, crop prices remain below average levels and below many farmers' break-even costs.
--Fuel prices are at 20-year highs, adding 10 to 15 cents per bushel to the production cost of corn, which is selling in the neighborhood of $1.85 per bushel.
--The latest U.S. Department of Agriculture figures show that the farmer gets only 20 cents of every dollar the consumer spends on food, compared with food processors, who get 39 cents.
--The interest rate hike announced May 16 by the Federal Reserve will push the interest rate on many farmers' operating loans to well above 10%, a rate not seen since the early 1990s.
--This summer's prolonged drought is bringing Nebraska farmers lower crop yields, higher irrigation costs and time-consuming additional chores, such as hauling water to cattle and opening and closing gates on irrigation pipe more frequently. A Nebraska Farm Bureau Federation analysis estimates the summer's drought will cost the typical Nebraska farmer more than $67,000, if it continues through the growing season.
--On the regulatory front, the Environmental Protection Agency wants to restrict or ban some of the most important crop protection products. EPA also wants to reduce sulfur in diesel fuel, even in the pristine countryside, to improve air quality. The net impact of this could be a five- to 10-cent increase in the per gallon cost of diesel for farmers.
All of this could be very depressing. But, fortunately, some good things have been happening, too: The $15.3 billion assistance package adopted by Congress in May will bring needed income to farmers. Permanent Normal Trade Relations status for China will bring considerable export opportunities, and there is a movement to restore trade with Cuba, too. And Congress is moving to reduce estate taxes that too often mean a death of family farms.
It takes a lot of work, knowledge, skill, risk-tolerance and conviction to be a farmer. It also takes a certain optimism to be a farmer, a conviction in a drought year that "Every day we are one day closer to rain."
In other words, it takes a lot of hope. On a dry day, with low prices and high costs and prospects for more, it is a good thing hope springs eternal.