Mississippi Farmers Closely Watching Farm Bill VoteBy Daniel Cherry | Published 19 Jun 2012 07:50pm |
Farmers in Mississippi are keeping a close eye on Washington as the Senate debates the latest proposal of the 2012 Farm Bill. MPB's Daniel Cherry reports how many rice and peanut farmers in the Magnolia State believe lawmakers are giving them a raw deal.
As Joe Morgan drives his farm truck through his fields outside Petal, it's clear to see, he's got a lot invested in peanuts.
"This field back through here is about 240 (acres). This is the biggest field I've got period. That's all peanuts back through here."
Morgan gets out to take a look at how his crop is coming along. He observes his peanuts with the tenderness of a gardener, but truth is, Morgan's operation is closer to high-stakes gambling.
"I've got 1,250 acres of peanuts and just out of pocket $350 an acre, I mean, you're talking about a good bit of money right there."
Morgan is looking at 430 thousand dollars invested on the front end. That's in addition to a few hundred thousand more for the tractors and peanut pickers needed to harvest the crops. In an effort to reduce federal spending, U.S. Senate's version of the Farm Bill would eliminate popular direct payments to farmers, in favor of a crop insurance based model. Many like, Malcolm Broome, Executive Director of the Mississippi Peanut Growers Association think that heavily favors Midwestern farmers.
"It's a double-edged sword, and that's why it just kind of amazed the folks in the South that they came out so strong and made a statement, 'Well we know where the share of the money toward the South in the previous years, and it's just not going to happen with this Farm Bill in the Senate.' And that really stirred up some dander quick."
It's a move expected to save the federal government about 5 billion dollars a year in direct payments to farmers. Broome says that's fine for farmers who grow corn and soybeans because those prices are based on regulated commodity markets. The peanut market, however, is much more volatile and subject to big swings in prices. The Senate version is like insurance, meaning Congress sets a target price based on historic market prices, if the market drops, the government makes up the difference to the farmer. Broome says, the problem is, input costs like fuel and seed have spiked in recent years and historic numbers don't work now.
"If we get them going to the other extreme, where we've gone from $1000 a ton, we go down to $250 or $300, then you've got a lot of folks who just may not get paid in the whole deal because they've got equipment notes, they've got land notes. This whole process needs to try to keep the fluctuation out of it."
Broome would like to see price protections in place that would ensure a peanut farmer could get back on his feet, even if he has a bad year. Mississippi rice farmers want that same assurance. Nathan Buehring is a Rice Specialist with the Mississippi State University Extension Service.
"With a rice farmer, with inputs being high, $700 and upwards, almost $800 an acre in terms of production. 75% coverage level is not adequate for a farmer if he has a disaster to get reimbursed for just his cost of production expenses."
Let's say, for example, there's a farmer in Humphreys County with 500 acres of rice. On the front end, at 700 dollars an acre, that farmer has about 350 thousand dollars invested. So if the federal government's price guarantee only covers 75 percent of the cost and the bottom falls out of the market he has about 90 thousand dollars on the line. That's a loss not many farmers can handle in a year and stay in business. Again, Nathan Buehring.
"Those levels need to be somewhat higher to get us at break-even level, and therefore, the actual rice producer would have protection under the crop insurance or some other form of legislation in the Farm Bill."
The Senate is currently going through more than 70 amendments to the Farm Bill legislation. Mississippi Senator Thad Cochran and other Southern senators had fought with little luck to make the bill more Southern-farmer-friendly. In a statement Senator Cochran said couldn't support the bill without amendments to have stronger price protections for Mississippi farmers. Those amendments failed Monday evening. Now farmers and advocates like Malcolm Broome are putting their faith in the House of Representatives.
"We like the House bill. It's very favorable to us. Get the House bill passed and then get those two in conference and then, hopefully, at that point we'll come out with a good compromise that will help everybody. We're not trying to leave anybody else out. We just want our fair shake, and we don't want the budget balanced on the back of the peanut growers."
Thousands of Mississippi farmers are keeping a close eye on Washington as Farm Bill debate continues. The Senate could vote on the bill as early as this evening.
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