Economic trends turn downward for farmers

[KY_EnviroGuy]

Economic trends turn downward for farmers
By Millie Munshi and Shruti Date Singh / Bloomberg
Posted Feb 15, 2019 at 3:59 PM Updated Feb 15, 2019 at 4:00 PM

Read more here: https://www.theledger.com/news/20190215/economic-trends-turn-downward-for-farmers

(snips)

On Thursday, the farm belt’s malaise deepened after the U.S. Department of Agriculture predicted soybean exports would stay below their pre-trade war levels until the 2026-2027 season. That followed a report that sales of the oilseed in early January had the worst week ever. And things didn’t end there: The Federal Reserve Bank of Kansas City warned that farm incomes were likely to have a weak start in 2019 and that credit was tightening at lenders.

“It’s not a pretty picture, but it’s not getting a lot worse quickly,” said Dan Kowalski, at farm lender CoBank Acb in Greenwood Village, Colorado. “It’s getting modestly worse over time.”

Some of the hurdles have been around for years. Consecutive seasons of bumper crops kept grain inventories flush. At the same time, U.S. meat production was soaring and dairies were overflowing. The supply boom meant prices stayed low for a long time, while robust demand kept things from falling off a cliff. In fact, farm income posted a 22 percent rebound in 2017.

Then came Donald Trump’s trade war.
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“The bailouts did help out some,” Lynn Rohrscheib, chairwoman of the Illinois Soybean Association, said in an interview with Bloomberg Television this week. “But most farmers, they just didn’t want that. We want to be able to grow our crop and receive a fair price.”

Rohrscheib said she knows of some producers who aren’t farming this year because of the tariffs, and that her family “took a $600,000 hit to our annual income” as a result of the trade war.
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Meanwhile, other Trump policies have also taken a bite of out of the farm economy.

A labor shortage , which some in the industry say is at least partly sparked by Trump’s tough stand on immigration, means employers have been forced to boost wages in the face of sluggish markets. On Thursday, U.S. poultry producer Pilgrim’s Pride Corp. said it was increasing wages $50 million, year over year, to attract workers.

What will it take for farmers to finally see that Trump lies to them every time?...... ......

[wellst0nev0ter]

1. Womp Womp

pay back the Trump welfare, goobers.

[KY_EnviroGuy]

5. Unfortunately, it will affect all of us.

Grocery bills everywhere will be going up......

[Wellstone ruled]

2. My guess is,this story will not

improve over the next sixty days. But will only get uglier as the planting season starts in two to three weeks. Forward Crop Financing is tightening up,and if your balance sheets are not sustainable,kiss you butt good bye. Might as well book you Auction or chapter 12.

[KY_EnviroGuy]

4. Wellstone, is there a reason you're aware of....

as to why credit is tightening for farmers? Or, is that a national trend for all credit?

I'm guessing the trade war has caused prices on farm machinery to go up as well.

[Wellstone ruled]

8. Credit is tightening due to poor Cash Crop pricing.

Noticed today that Grain Companies are not expecting any real World Markets again until 2024 or 2025. Once you lose those markets,well it takes years to put those sales and Infrastructure back in place,barges and ships have to be booked and that can take months for that one item. Just the Rail car bookings can take up to six months or more. And this all depends on if you make the sale. Once the Brazilians and the Aussies replaced our farmers,going to be one hell of a tough battle getting those sales back. Same quality of grain only they are now in the drivers seat thanks to Trump and his Pitty Party.

A lot of the Credit squeeze is due to the a fore mention issues of no off shore market gravy sales to keep the demand ahead of supplies. We have a glut of Crops in the Bins and only so much of that will ever be needed in this year. And the 1980's farm crisis is front and center with the Lenders. If your balance sheets are loaded with debt and your operating margins look shaky,chances are your forward financing is in trouble. Machinery is a mixed bag and it is dependent on local circumstances. Appears there are Foreign Buyers stepping in to pick up used Equipment and that has to do with Foreign exchange rates. Cheaper to buy at Auction and have it shipped than buy new at home.

People forget,Money is fungible and can be put to work within a millisecond some where else. And the Big Grain Companies are not going to lose the sale,they just setup shop off shore and still get their piece of the action. BTW,several mega grain growers here State side have major operations in Brazil. And the Aussies are killing the China Market just on the Freight and delivery time . And Trump has poisoned the Trade Waters with China and he does not have any ideal how bad he screwed that up.

[KY_EnviroGuy]

9. Thanks, very informative. If only American consumers knew!

Obviously, few or none of the deplorables cheering Trump's trade war are aware of those transport "details". Some of that trade may never come back.

From your posts, I suspect you're well aware of this situation, but I was reading on Farm & Ranch/Kearney Hub that corn and soy bean harvests are setting records. What the hell are they going to do with all that product? Sales of pork to China is down, so hogs are eating less of it, LOL.

See:
USDA survey shows record corn and soybean harvests in Nebraska
Link: https://www.kearneyhub.com/news/agriculture/usda-survey-shows-record-corn-and-soybean-harvests-in-nebraska/article_b69d13f6-2e1a-11e9-bf45-338de4c85662.html

and.....
Nebraska’s 2018 corn crop at record high (discusses other crops as well)
Link: https://www.kearneyhub.com/news/agriculture/latest/nebraska-s-corn-crop-at-record-high/article_7c2b0fec-4b69-5ec5-8235-d023621719b2.html
(snip)

While Nebraska farmers face a number of problems from rising input costs, low commodity prices, high property taxes and trade barriers, the one thing they can celebrate is that can constantly grow huge crops.

I can't comprehend how today's farmers deal with the stress from so many directions, and they have to pay for their own healthcare. Used to be mainly just weather to worry about.

[Wellstone ruled]

14. In your back yard,Spring Pllanting is

most likely starting especially in the Western Part.

Understand the Farmers with good Balance Sheets and Bins full of Grain are getting Loans based on Cash Grain at the Elevator pricing. Short term fix for a long term problem. When you kill off the Goose who gave you those golden eggs(China),you are in for one hell of a nasty slap in the face.


Will be watching the Ethanol market and that might reduce some Corn on hand inventories and that is because Trump signed a bill increasing Gas blend from 10% to 15% but that only makes Carl Icahn a mega billionaire with his Regional Control of a couple Blenders her in the West.

Here is a tid bit,the Farmers growing Organic Corn and Beans are smiling all the way to the Bank. That is the new Hot Market and it takes three years to convert to Organics which is another interesting issue in its self.

You mentioned Pork,something is happening in that market. Notice zero footballing of Pork by Kroger or Albertson Super Markets for the last five weeks. Smithfield is mostly China owned,and the largest processor,did see they received some 200k+from Trump's bribery Bill for the Farmers. Did hear there was a major attempt to artificially prop up the market by moving thousands of pounds of Pork into storage. Or did China do a quite buy. Something goofy going on. China is developing their own Pork operations in Africa and other Countries.

So what Donnie of little Smarts does for his Ego,does have serious Consequences. Especially for his so called Base.

[KY_EnviroGuy]

15. Thanks, Wellstone - very informative.

Just wish the general public stayed better informed on the complexities of our food supply chain. You've made it obvious just how isolated most of us are from that web and its intricacies.

Maybe Trump in all his brilliance will start storing ethanol and pickled pork bellies in the big tanks at Cushing.....

[Drahthaardogs]

3. Oh well. Maybe they will enroll in CRP and pheasants

And quail will come back

[Demovictory9]

6. trump will dole out more farmer relief (called welfare if given to average person)

[First Speaker]

7. This headline could have been used anytime in the past 100 years...

...or maybe even longer. Economic trends are always down for farmers...it's the original evergreen story...

[Achilleaze]

10. republicans are crushing America's farms

deplorable the way republicans keep weakening America.

[KY_EnviroGuy]

11. Weak and for sale to the lowest bidder.....

on the international land and equipment market. Many more farms will be auctioned thanks to tRump.

Rural bankers in 10 states worry over farm loan defaults
January 17, 2019
Link: https://apnews.com/a9d6a53340864a46b44fbd0331755b04

(snip)

OMAHA, Neb. (AP) — A monthly survey of rural bankers in parts of 10 Plains and Western states suggests banks are growing increasingly concerned about farm loan defaults in 2019.

More than 4 of every 10 bankers questioned for the Rural Mainstreet survey for January said they expect farm loan defaults to be the year’s biggest challenge.

Creighton University economist Ernie Goss, who oversees the survey, says their outlook is being negatively influenced by tariffs, trade tensions, weak commodity prices and the partial federal government shutdown.

[Achilleaze]

12. Are bin Salman and other Saudi-republican plutocrats buying America's farms?

Comrade Dirty Donny* and the repubes are goosing this process...and thereby further weakening America.

There are a lot of stories like this on the net.

Saudi Arabia buying up farmland in US

https://www.cnbc.com/2016/01/15/saudi-arabia-buying-up-farmland-in-us-southwest.html

* aka republican Draft-Dodger-in-Chief

[Hermit-The-Prog]

13. sounds a lot like Rotten Ronnie

Under Reagan, it was Wall Street buying up farms bankrupted by Reaganomics.

[KY_EnviroGuy]

16. Thanks, Achilleaze. Good summary review from 2017 here and it's not just the Saudis.

Foreign investment in U.S. farmland on the rise
By Johnathan Hettinger and Robert Holly with additional reporting by Jelter Meers/Midwest Center for Investigative Reporting
June 22, 2017

Link: https://investigatemidwest.org/2017/06/22/foreign-investment-into-u-s-farmland-on-the-rise/

(snips)

In 2013, the Chinese firm Shuanghui received wide public attention when it purchased U.S. pork producer Smithfield Foods for a record $4.7 billion.

In an overlooked part of the deal, Shuanghui also acquired more than 146,000 acres of farmland across the United States, worth more than $500 million, according to U.S. Department of Agriculture data.
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Indeed, over the past decade, foreign companies have been investing in agricultural land in the United States at a record pace, according to a Midwest Center for Investigative Reporting analysis of USDA data. The data was compiled from 1900 to 2014 under the Agricultural Foreign Investment Disclosure Act (AFIDA).
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The database shows that between 2004 and 2014, the amount of agricultural land held by foreign investors doubled from 13.7 million acres to 27.3 million acres — an area roughly the size of Tennessee.

It's not only foreign control of land that is of concern. It's also the fact that they're helping to suck our aquifers and river systems dry (along with greedy Americans).

Therefore, in summary, America is loosing precious water table and farm land so Saudis can feed their cows, horses and camels, enabled by our buying their oil. China is enabled by our buying megatons of their cheap merchandise.

[Achilleaze]

17. republican "values" are to blame for this weakening of America's heartland