Growing more corn at a loss


We recall the solid spring reports: crop and land prices down, corn plantings up. And now the late summer reports: bumper corn and soybean crops based on those increased Iowa and Midwest plantings, with corn bouncing down near $3 a bushel. There is no reason to increase inventory of something that will not sell at a profit. But here we have it.

And we had it the year before. And the year before that.

We also recall the years immediately leading up to 2008. There was a perfect storm of drought, increased livestock herds and a buying spree from China and India. Farmers increased plantings every year. They ripped out buffers, let Conservation Reserve Program contracts expire and plowed through the fencerows and into the ditches.

The reaction this year has been moderated. Iowa land prices are off by a percentage point. A Purdue/Chicago Mercantile Exchange survey showed that farmers are optimistic about crop prices in the long term. Most believe that prices will increase next year. Well they might. Climatological signs point to drought. China has beefed up some soy purchases. We could have a run-up next year.

What is a farmer to do in this environment?

You just keep rowing. Spread your costs over more acres. Get every last corner to make that cash rent payment. Go after yield, because you cannot count on price.

There is no alternative, really.

Plant native grass? Who will pay for that? How will that feed the machinery?

The reason that people are willing to go with the agri-industrial flow is that this is where the capital flows. There is no alternative. Conservation programs are under attack in Congress. The CRP and Wetlands Reserve Programs are stunted. The House wants to eliminate Environmental Quality Incentives Program (EQIP).

At the same time, agriculture is confronted like never before with demands for improved environmental stewardship. We know all too well as Buena Vista County is defending itself in a lawsuit by the Des Moines Water Works over agricultural nitrate pollution of the Raccoon River.

Federal crop insurance programs, subsidized by the taxpayers, allow farmers to buy a certain level of protection against revenue troughs. That’s another reason that market reactions have been muted to the crop-price implosion. The government is cushioning the blow.

The public used to get something in return for a government safety net. For one, it got price stability (which benefited farmers who understood the value). Second, it got conservation benefits. We used to have a 10% set-aside program — for farmers who participated in price supports, they were expected to idle 10% of their land to reduce supply and benefit the environment.

It worked until undone by the Nixon Administration.

We had price stability. And we did not have lawsuits over the sorry state of the Raccoon River. And we had a lot more farmers buying pickup trucks and tractors every year.

The idea of national food security has become passé. It was a very real concern following World War II. It will resume being a concern if our best farmland and nutrients are running into the Gulf of Mexico — which they demonstrably are.

We also understand that technology is proceeding at such a pace that it outstrips our ability to manage it well. Markets alone cannot do the job.

Next year Congress will begin talks on a new farm bill. Little has been said about it during this campaign cycle. A precipitous drop in crop prices, plus myriad environmental flash points, demand a discussion about how to induce people to quit farming marginal lands even when prices are in the tank — especially when prices are in the tank.

We must tie conservation compliance to crop insurance participation.

Iowa State University has proven that nutrient loss can be cut by 90% by planting 10% of a field to native grass. If every Iowa farmer set aside 10% of acreage (divert it to livestock pasture, if you would like), prices would rise enough to cover the loss of acreage. We know this to be true, because we have done it this way before. It is not in the interests of the corporate integrators because their goal must be to apply their product to more acres, not less. They have a lot of money to convince congressmen that they are right. We know better.

Iowa is trying to buy conservation compliance an acre or two at a time. This is a federal problem: too much corn on too many acres losing too many nutrients and soil. Prices go up, cut conservation plans. Prices go down, plant more acres. We can’t go on like this. The problem can be fixed by providing an alternative to plowing more ground. That we have no alternative is a failure of imagination, of policy and, ultimately, of farmers and rural communities who should be demanding it.