By Greenscans co-founder and BerryBroad Juanita Gaglio
It has been a summer that both farmers and consumers will not
forget, with two droughts very different in nature that have been affecting
retail prices. We view news images of scorching farmland and cattle suffering,
due to a prolonged
period of no rain with record-breaking high temperatures
adversely affecting 55% of the U.S. To make matters worse, on another front we
are facing a labor drought due to a shortage of legally available agricultural
workers.
Prolonged dry spell in Midwest and Southeast
More than half of all U.S counties have been designated
disaster zones by the U.S. Department of Agriculture (USDA). Not since the 1956
drought has such a large geographic area (55%) of the country been impacted.
The historic Dust Bowl era is well known with a drought that covered 58% of the
U.S. in that year. The situation affecting farmers, their livestock and
crops, and even the flow of the Mississippi River, is as heartbreaking today as
it was back then.
At the turn of the century, settlers arrived to farm the rich
land of the Southern Plain states that yielded both great harvests and profits.
Iowa-based Three Rivers Ag Consulting owner Frank Moore, who is also a corn and
soybean farmer, explains that this geographical area of the U.S has
historically experienced an 18-year drought cycle for the last 17 years.
“In contrast to the past drought conditions, this has been
the longest period, twenty-four years, that the area has gone through without a
drought occurring,” he tells www.freshfruitportal.com.
Lessons from the past have vastly improved farm practices
with better soil conservation and modern hybrid seeds that are resistant to
drought conditions two to three years away, yet the main concern today is the
pernicious extended dry spell.
“The drought actually began in November and has been
characterized by lots of geographical variability. There was a lot of variability
even in the same field,” adds Dan Towery of Ag Conservation Solutions in
Lafayette, Indiana.
“The drought affected pockets of corn and soybean crops with
corn hit the worst due to the crops requirements for more water. With
corn in such wide demand from feeding cattle and in materials, many people are
suffering and are going to see it in increased prices.”
He says corn crops were very short on moisture when 100°F
(37.8°C) plus temperatures arrived, greatly affecting pollination or causing
corn kernels to abort. However, he clarifies there are still pockets of farms
with decent crops and areas with 50% yields, while some soybean farms have
fared all right.
“Soybean yields may still be halfway decent although in some
areas the soybeans burned up back in July.”
Generational farmers are commenting that they have never seen
weather like this before. What makes this dry spell different and of concern is
that climatologist have labeled it a “flash drought” because in contrast to
what happened in 1956, it did not develop over multiple seasons or years, but
in a matter of months and is still unfolding.
With no end in sight, topsoil has turned dry while “crops,
pasture and rangeland have deteriorated at a rate rarely seen in the last 18
years”, according to the National Climatic Data Center (NCDC) based in
Asheville, North Carolina.
What was expected to be a boom year for corn farmers sowing
96.4 million acres – the most since 1937 – has now given way to tremendous
uncertainty with 38% of the corn crop described as labeled in poor or very poor
condition by the USDA, with 57% of pastures and range land graded very poor to
poor.
California – San Joaquin Valley experiences a different
“Grapes of Wrath”
The famous novel “The Grapes of Wrath” by John Steinbeck came
out of the Dust Bowl period; a story of one of many families migrating to
California’s farming fields. It is estimated that during this time about
300,000-400,000 people moved to California with a certain percentage relocating
to farm labor camps.
Fast forward decades later, a similar climatic situation
exists in the Plain states with a political impasse in California leaving crops
to rot in fields due to lack of immigrant labor. According to the Immigration
Compliance Group, “an estimated 75% of California’s agricultural workforce is
foreign-born, primarily in Mexico and about half the workers are believed to be
unauthorized”. A political compromise has yet to be found between the
government’s mandated E-Verify and the proposed guest worker program, and it is
our nation’s agricultural industry that suffers as a result.
The problem extends much further than California, from the
apple fields in Washington to the orange farms of Florida and fruit orchards in
between. It seems the government is in crackdown mode with the election year,
meaning fewer farmers are willing to risk taking in illegal workers.
We’re talking about a political football without any
touchdown in sight, and the game has gone nowhere under both parties dating
back to the Bush Jnr administration. It’s no secret that most farmers are
Republicans but somehow the party has done little to resolve this issue, while
Obama hasn’t helped the situation with more restrictions now than before.
It seems like common sense to me that one of our country’s
biggest industries could support itself with legal labor. Sound idealistic?
Well it shouldn’t be. Our nation is built on the free market ideal, so it
shouldn’t be that half our agricultural workers are unauthorized. There must be
a way to ‘legalize’ them so that our economy and labor markets can flow more
freely. They’re doing the job anyway, supporting the economy and our exports.
The idea of ‘legalizing’ does not even mean making these
workers residents or citizens, but giving them the dignity of being authorized,
rather than hiding away from authorities to make a living. A change in this
policy to a more dynamic guest worker scheme would improve the welfare of ‘illegals’
who could no longer be labeled this way, as well as the farmers who employ
them; not to mention there would be less fruit left to rot on our farms. An
election year should not be the excuse for labor problems, but the trigger for
immigrant worker reform.
Getting our own people to work?
The other question is whether we could get more U.S. citizens
working on our farms. It has been a difficult task in the past, but you have to
keep in mind that our unemployment rate hit 8.3% in July, and that doesn’t include
people who have given up looking. I was shocked to see Americans picking fruit
as guest workers in Tasmania on a trip to Australia last year, and when I told
that to people here in California they were surprised too. Here we are with a
shortage of farm labor and our own citizens are on the other side of the
Pacific Ocean harvesting asparagus.
If our young people are willing to go as far away as Tasmania
to pick fruit, why can’t we get them to move across our own country? It
probably has to do with a mix of cultural experience and the wages they pay to
work on farms in Australia, at more than US$20 an hour. I’m pretty sure most
farm owners would laugh off the idea of paying such an exorbitant rate, but the
reality is that most developed countries pay their farmhands more than we do,
and they still manage to compete. Every season we still buy fruit from places
like Australia, New Zealand and the European Union.
Is it really unimaginable that young unemployed Americans
would be willing to travel across the country for the cultural experience of
working on a farm, perhaps with a slightly higher wage? Maybe they wouldn’t be
willing to do it, or maybe it hasn’t been promoted. I would be interested to
know if it has. Could the government provide assistance to help push up the
wage and attract workers? After all our taxes go towards billions of dollars
worth of crop insurance subsidies ever year.
If we don’t find some kind of solution to this labor problem
it will ultimately mean less production here and more imports from abroad.
Affects of both droughts on farmers, consumers and importers
Both droughts could have dire consequences on the anemic U.S
economy both in lost income to farmers and higher retail food prices to
consumers. The U.S is the world’s largest grower and exporter of corn,
government figures show, the crop valued at $76.5 billion in 2011 followed by
soybeans, hay and wheat.
Furthermore, investors and insurance analysts are raising
questions over the farmland boom’s sustainability. Insurance payments are
beginning to play a bigger role in supporting the farmer and land prices. In
the case of the California labor drought, California crops will continue to be
at peril without people to work the harvest and, furthermore, according to
California Senator Diane Feinstein, at least 84,155 production acres and 22,285
jobs have moved to Mexico.
In the case of corn, the question is who will benefit or
suffer; the consumer, cattle or the refinery? The consumer will have sticker
shock as corn can be found in everything from whiskey to high fructose syrup to
ethanol. High corn prices will affect where the corn goes first; to feed cattle
or to refineries for ethanol. Calls to waive the ethanol mandate are growing
and livestock feed is being rationed. One thing is certain, with the lack of
corn and soybeans to fulfill contracts, Argentina and Brazil will benefit in
shipping these crops to North America companies.
Although consumers will not see immediate price hikes at the
supermarket, the government forecasts that food prices will rise by about
3.4-4.5%. The USDA estimates that a whole chicken costing US$4.50 in 2011 will
cost closer to US$5 next year. A typical family food budget could increase to
US$250-300 within 10-12 months on basic items; beef, poultry and dairy
products, according to the USDA Economic Research Service.
The jury is still out on the financial blow to crops and
livestock, with some analysts raising concerns that this drought could turn
into the type of multilayered event that damaged the farm belt in the 1950s
and before that during the Dust Bowl of the 1930s. Could this be the
resurrection of the 1930s “Last Man’s Club”?
During the bleak Dust Bowl days, John McCarty, editor of the
Dalhart Texan created The Last Man’s Club, designed to promote a spirit of
courage. Judge Cowen recalls the pledge members had to sign: “In the absence of
an act of God, serious family injury, or some other emergency, I pledge to stay
here as the last man and to do everything I can to help other last men remain
in this country. We promise to stay here ’till hell freezes over and skate out
on the ice”.
The Midwest drought will be easier to make a comeback with
heartier crop cover and hybrid seeds to withstand intense heat, but on the
other side of the country, the California labor drought will not be as easy to
ameliorate. Politics does not blow like the winds of nature, there will be
further debate and I daresay that the Midwest will make a comeback before the
immigrant workers return to work the “Grapes of Wrath” in California.
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