Vol. 79/No. 1      January 19, 2015

Many farmers were able to keep from going under because they had crop insurance, which guaranteed a price of $4.62 a bushel for a portion of their crops.

“Three dollar corn wouldn’t cover your production costs,” Randal Jasper, a grain farmer here, told the Militant. “If it hadn’t been for crop insurance, I would be out of farming.”

Farmers get squeezed between seed and fertilizer conglomerates and farm implement companies on one side, who make what farmers call their inputs, and the prices paid by grain processing monopolies and other buyers on the other.

Nearly 40,000 farmers have lost their farms over the last five years. Others have struggled to put off expenditures, postponing purchase of new machinery.

Workers for the agricultural implements bosses are feeling the effect. In August, John Deere announced layoffs of 1,000 workers at its tractor plants in Iowa.

“Next year’s insurance payouts will likely be lower because they are based on today’s below-cost-of-production grain prices,” Jasper said.

The Farm Bill adopted in 2014 replaced direct payments to farmers with plans for subsidized crop insurance. How these changes will impact small family farmers is yet to be seen and many farmers fear the new government programs. “I don’t know if I want to go back in there,” said Jerry Hernan, a grain farmer from Blue River, commenting on the government Farm Service Agency.

The cost of the inputs that farmers use to produce their crops are at all-time highs. Seed, fertilizer, pesticides, and other nonland related costs in Illinois have more than doubled since 2006.

The cost of renting crop land to expand production also has skyrocketed. Farmers rent more than half the 250 million acres used to grow corn, soybean and wheat in the U.S. Average rent in Iowa went from $131 per acre in 2004 to $270 in 2013.

Negotiating rent cuts is not an easy task. “Every time we go to a landlord they say pay or we won’t rent you the land,” Hernan said.

Many farmers don’t consider cutting back on land rental an option, fearing they won’t be able to get it back when prices rise amid fierce competition for finite acreage to plant and grow.

“Some landlords are absentee owners who have land for investment but many are retired farmers or widows who use the rent to pay taxes and have a little income,” said Jasper. “It is hard to ask them to take less money when they are relying on it for their livelihood, but I have to. At today’s prices, I don’t make as much money from cropping on a farm as the land owner gets in rent.”

“I don’t know how we will make money in 2015,” Hernan said. But both Hernan and Jasper are planning to put crops in the ground.

“I can’t just quit farming for a year” said Jasper. “I have a combine payment, sprayer lease payment, planter payment and a mortgage to pay.”

“I don’t know what to say. What are we going to do, quit farming because we can’t make any money?” Hernan said. “I don’t have the answer.”  
 
 
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