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Vol. 81/No. 8      February 27, 2017


US farmers face crisis as prices plummet, debt soars

As grain prices plummet U.S. farmers face the biggest crisis in decades. “Across the heartland, a multiyear slump in prices for corn, wheat and other farm commodities brought on by a glut of grain worldwide is pushing many farmers further into debt,” the Wall Street Journal reported Feb. 9.

The international overproduction of grain is fueling cutthroat competition and tumbling prices. U.S. farmers’ share of world grain sales is now half what it was in the 1970s. And it’s the small farmers — not the grain, feed, pesticide and railroad monopolies that prey on them — that bear the brunt of the crisis.

“I’m very careful how I spend money. I don’t buy new machinery and use bare amounts of fertilizer,” Vern Jantzen, 59, who farms corn and soybeans on 200 acres outside of Plymouth, Nebraska, told the Militant Feb. 11. “If you have a good crop you can limp along, but there is still not really enough to cover all your costs. Some farmers are losing $200 an acre on either corn or soybeans.” Jantzen, whose family has been farming this land since 1891, is a member of the Nebraska Farmers Union.

Farmers’ income in the U.S. will drop 9 percent in 2017, the U.S. Department of Agriculture predicts. Total farm income over the past four years has declined more than 40 percent, the steepest slide since the 1930s Depression.

Since 2012, corn and soybean prices have collapsed. Corn has plummeted from above $8 a bushel to less than $4 today; soybeans from nearly $18 to $10; wheat from over $9 to $4.50.

“Last year was the worst grain prices in 30 years,” Randy Jasper, 66, who farms corn and soybeans in Muscoda, Wisconsin, said in a phone interview. “One bushel — 56 pounds — of dry-shelled corn delivered to the market sold for $2.90 in 2016. It was a good crop yield last year, but farmers couldn’t compete because the price was so lousy.”

Jasper also noted that production costs keep rising. “Twenty years ago seed was $60 an acre, now it’s $120 an acre,” he said. “Fertilizer is up 50 percent since then, and the costs of machinery have tripled.”

At the same time the giant food monopolies — Archer Daniels Midland, Bunge, Cargill and Dreyfus, which control 75 percent of global grain trade — have been boosting production in their drive to expand exports to compete on the world market.

Straining to cut losses in a bad market, most U.S. grain farmers have produced record crops. But today the capitalist food giants won’t sell it because it’s not profitable. So the grain just “sits there in bins and holding elevators,” Jantzen said.

Seeking to keep going, farmers and their families get outside jobs. Only 20 percent of family farmers’ household income comes from the farm itself today. Jantzen said he has worked side jobs milking cows and as a truck driver for a local school district.

The farm population dropped from 6 million in 1945 to just over 2 million in 2015. Figures this low have not been seen since the mid-1800s. Total acres farmed in the U.S. have dropped 24 percent since the end of World War II to 912 million acres.

“In Nebraska we had almost 4,000 dairy farms in the late 1970s,” said Jantzen. “Now its down to 155, and this has a big impact on towns where these dairy farms were.”

There were 28 students in my high school graduating class nearly 40 years ago, Craig Scott, a farmer in Ransom, Kansas, told the Journal. Most of them were farmers’ kids. This year there are nine.

Jasper, who gave up dairy farming 20 years ago, said that in 2016 “I lost a little money and in 2015 lots of money. If you have to keep doing this at some point you just go broke.”

In the late 1970s and ’80s thousands of farmers mobilized in actions, including tractorcades to Washington, D.C., to fight farm foreclosures and demand debt relief. Lee Scheufler, a farmer in Sterling, Kansas, told the Journal he was on some of those protests. He said he is reminded of those actions today.

“The potential for a big crisis is real,” Scheufler said. “If things stay similar to how they are now, you haven’t seen anything yet.”  
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