By former USDA Secretary John R. Block
We are looking at record crops of corn, soybeans, and wheat this year. Dairy farmers are suffering with the lowest prices since 2009. We have too much milk – not just here in the U.S. but in Europe also.
Members of Congress from farm districts and states want the government to help prop up a sinking farm economy. The Farm Bureau, Farmers Union, and National Milk Producers Federation are asking for help. Senator Moran from Kansas wants the government to buy wheat and ship it to countries that need food. Agriculture Secretary Vilsack suggests that USDA purchase $150 million worth of cheese and give the cheese to food banks and school nutrition programs. Taking these products off the market would raise prices.
On the plus side, our exports of soybeans are surging, thanks to China. New crop export commitments are ahead of last year. Corn exports are impressive. Wheat exports are expected to surge 22%. U.S. food production is something to brag about. However, too much of anything will drive down prices. You know the story – the cure for low prices is low prices. It seems like yesterday we had $7 corn.
I am sure that the government will be able to offer some support to farmers, but I would not expect very much. The Congress won’t have any time to act. They will be back in town in September, but not for long. The election is coming up.
After the election, there is some talk about trying to pass the Trans Pacific Partnership (TPP) trade agreement. With both Presidential candidates saying that they oppose it, the chances are slim. We need the agreement. Australia, Singapore, and other Pacific countries, including China, are negotiating their own agreement – and we are left out.
When I look across my corn and soybean fields, I just love the beauty of a healthy, bountiful crop. Harvest will be so much fun. We just wish prices were a little better.
John Block was Secretary of the U.S. Department of Agriculture from 1981-1985, where he played a key role in the development of the 1985 Farm Bill. If you would like to review his radio shows going back more than 20 years, visit johnblockreports.com.