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Severe Weather and Trade Wars Hit Michigan Farmers

Severe Weather and Trade Wars Hit Michigan Farmers

(EAST LANSING) -- Historic rainfall, flash flooding, excessive snow, tornadoes, extreme cold, and the China trade war have negatively impacted Michigan farmers and every resident will feel the impact.

 

That was the message agricultural experts from federal and state governments as well as Michigan State University (MSU), Michigan Farm Bureau and others gave August 13 as they testified before the Michigan House and Senate Agriculture committees' joint session at the MSU Pavilion in East Lansing.

Doug Darling, a sixth-generation Monroe County farmer, said this year's extreme weather resulted in two-thirds of his 1,600 acres going unplanted -- an experience that mirrors many Michigan farmers. Those farmers able to plant in mid- to late-June likely won't see crops mature, he said.

"Farmers are eternal optimists . . . but this year has been trying even on the best of us," he told the committees.

Stephanie Schafer, a sixth-generation dairy farmer in Clinton County, agreed, adding that although only 2% to 3% of Michigan's population are farmers, every resident will feel the impact.

"I don't think people realize and they won't realize until they get to the grocery store this fall and their tortilla chips are expensive and they can't figure out why . . . because there's no corn to make them," she added. "You're going to see groceries go up and . . . somebody will have to remind them what kind of spring we had and what kind of summer we had without any rainfall. 

"You can feel that heartbeat through the whole industry," Schafer added.

A new U.S. Department of Agriculture (USDA) report shows farmers across the country were unable to plant more than 19.4 million acres this year -- the highest number since the 2007 inaugural report. That includes 498,046 acres of corn and 349,481 acres of soybeans, the report noted.

The USDA estimates that 17.3% of Michigan's farm acreage did not get planted this year -- the national average is 7.6% -- a number that includes only USDA participants and not the total agricultural industry, one expert noted.

The Michigan Department of Agriculture & Rural Development (MDARD) statistics show there are just under 10 million acres of farmland in the state, which is home to about 47,600 farms. Livestock, including dairy, has the greatest economic impact at $5.13 billion, followed by field crops with an economic impact of $5.12 billion, MDARD reports.

Rep. Kevin Coleman (D-Westland) asked what Michigan is doing to be on the cutting edge of hemp. 

MDARD Director Gary McDowell said Michigan has about 32,000 acres planted with hemp and a coordinator solely assigned to hemp has been hired.

"We don't know yet, but of course, we really hope it's going to be a great crop for Michigan and really help our growers," he said, noting that the northern part of the lower peninsula seems to have "a lot" of hemp activity.

Sen. Dayna Polehanki (D-Livonia) asked about what impact trade negotiations, specifically with China, had on the agriculture industry.

Joel Johnson, USDA Farm Service Agency's state executive director, replied exports to China have been an "extremely large part of our exports" and the cut back in purchases "has had a large impact on Michigan farmers" and the agency's 2019 Market Facilitation Program is funded nationwide at roughly $14.5 billion -- down from $80 billion in the prior year.

"The program is designed to help reduce the loss to the farmers because of marketing difference," he explained. "It's not a full replacement; it can't be. We don't have the money to fully replace that. We wish we could."

China recently announced it canceled all purchases of U.S. agricultural products, but President Donald Trump appeared to attempt to de-escalate the trade war August 13 when his administration delayed additional tariffs on China goods.

In June, the Michigan Legislature appropriated $15 million into the Agricultural Disaster Loan Origination Program, which will help ensure farmers will cover their expenses over the summer. The program is a partnership between farmers, processors, private lenders and the state that provides a 1% interest rate on loans to support the agriculture industry through loss of crops due to weather-related causes.

Dave Armstrong, president and CEO of Greenstone Farm Credit Services, which is a cooperative of 24,000 part- and full-time farm owners, said his organization wasn't at the table when the $15 million loan program was developed. He raised concerns, including a lending institution's inability to set interest rates and the need for longer loan terms to provide those with losses additional time to repay the loan.

Also, among his concerns are "structural challenges that are the primary cause of eroding equity and inability to repay principal" as well as an increased number of farmers impacted, which he says will "far exceed the 2012 disaster."

"This isn't our first rodeo with tough times," Armstrong said, noting that of Greenstone's 11,600 full-time farm customers, "only 22 are currently in bankruptcy or a foreclosure situation."

McDowell summed up the August 13 testimony: "It's been a rough year... Agriculture is facing many hardships."

"No matter where you live in Michigan, we are in this together," McDowell told the committee members. "Let's hope for a late frost this year."

A key to success, he noted, is infrastructure, including roads and short line rail. He said the roads "are crumbling" and farmers can't get their produce down the road. 

One example, McDowell noted, was an apple farmer whose load was rejected because the apples were bruised "from bouncing down the road."

McDowell said Michigan also needs trade workers and housing.

Darling said the proposed 45-cent increase to fund roads will cost him an additional $770 per year to move his trucks down the road.

"We need funding to fix roads . . . but 45-cents is too aggressive," he said.

Sen. Roger Victory (R-Hudsonville) said solving the agriculture crisis "will take a renewed effort and the best minds providing expert input."

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