READ the NAFB’s National Ag News for Friday, March 27th

READ the NAFB’s National Ag News for Friday, March 27th

Sponsored by the American Farm Bureau Federation

Administration Won’t Drop Tariffs to Boost Economy

Previous reports have suggested administration officials were considering suspending tariffs to stimulate the U.S. economy. However, the top trade adviser for the White House, Peter Navarro, says the Trump administration isn’t considering that right now. A Marketplace Dot Org report says tariffs are taxes on imported goods that American companies and consumers always wind up paying. The head of the Coalition for a Prosperous America says a lot of the duties were first implemented because many imports were being subsidized or otherwise traded unfairly, injuring American companies and their ability to do business. Economists ranging from the Federal Reserve through the private sector have compared how much the tariffs have benefited the economy against how much difficulty they bring as well. “Tariffs cause more losers than winners,” says Dan North, senior economist for a group that provides trade credit insurance. “it’s a significant drag on the economy, especially in the current environment.” Mary Lovely, a professor of economics at Syracuse University, says a suspension would be aimed at U.S. manufacturers that import the items needed to assemble new goods.

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Farm Futures Survey says Farmers Planting More Corn in 2020

It looks like U.S. farmers are upping the number of corn acres going into the ground during spring planting. The newest Farm Futures survey shows farmers will plant 96.4 million acres of corn during the 2020 planting season. That’s the second-highest number of intended acres after farmers put a record 97.3 million acres of corn in the ground during 2012. The Farm Futures number is more than two million acres higher than the most recent USDA projection in February of 94 million acres. Farm Futures points out that a lot of things have changed between the two forecasts. The coronavirus pandemic hit, upending the global economy. The increased economic uncertainty, historically cheap input costs, as well as weaker soybean demand from China all appear to have made corn the optimal choice among somewhat limited options for Midwest farmers. Farm Futures estimates that soybean plantings will total 82.7 million acres, almost three million less than the USDA estimate of 85 million, which also came out in February. The survey estimates that farmers will plant 45.8 million acres of wheat, higher than USDA’s estimate of 45.0. Farm Futures also estimates that farmers will plant 11.7 million acres of cotton, less than the USDA estimate of 12.5 million.

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FSA Services Available by Phone Appointment Only

USDA’s Farm Service Agency county offices are open only by a phone appointment until further notice because of the COVID-19 outbreak. FSA staff are available to continue helping agricultural producers with program signups, loan servicing, and other important actions. Also, the FSA is relaxing the loan-making process and adding flexibilities for servicing direct and guaranteed loans to provide credit to producers in need. Program delivery staff will continue to come to the FSA office, but they’ll work with producers by phone and other online tools whenever possible. “FSA programs and loans are critical to America’s farmers and ranchers, and we want to continue our work with customers while taking precautionary measures to help prevent the spread of coronavirus,” says FSA Administrator Richard Fordyce. “We recognize that farm loans are critical for annual operating and family living expenses, as well as emergency needs and cash flow through times like this. FSA is working to find and use every option and flexibility to provide producers with credit options and other program benefits.”

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Farmers, Rural Businesses, Brace for a Possible Recession

Rural counties are in a fragile spot economically after years of weakness in farming and manufacturing, as well as a weaker recovery since the Great Recession. The COVID-19 pandemic has pressured the U.S. economy to the point that it’s facing another downturn. Politico says the pandemic has put a dent in global trade and U.S. commodity prices. It’s the latest economic challenge for farmers and ranchers after being hit by years of tariffs and weather challenges. “These are ‘black swan’ events, the kinds of things that you can’t plan for,” says John Newton, chief economist for the American Farm Bureau. “It’s a shock to the economy that we will recover from, it’s just a matter how long the drag will be on this.” Mark Scanlan is senior vice president of agriculture and rural policy with the Independent Community Bankers of America. Scanlan says, “It’s not just the farmers, it’s the Main Street businesses that they’re doing business with, the people that are employed by the processing and distribution chain.” Rural demographics could make it even more of a challenge to eventually bounce back, because the most isolated rural counties saw the biggest population loss and have the highest poverty rates.

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Hoarding is Pushing the Price of Eggs and Milk Higher

Panic buying and hoarding supplies is pushing wholesale egg prices in the Midwest to their all-time high. The Des Moines Register says prices for other staples like milk, beef, and even ice cream have gone higher as well. Joe Kerns is president of an agricultural consulting company in Ames, Iowa, who says the Midwest isn’t short on supplies, it’s abnormally-high demand that’s causing the price jump. Because of the uncertainty surrounding the coronavirus outbreak, consumers in Iowa and across the U.S. are piling way more than the usual amount of groceries in their shopping carts. That unusually-high demand level is driving prices higher. Kerns says it’s not a surprise because as restaurant dining rooms are closed, more people are cooking in their homes. Some grocers are seeing as much as six times the normal demand for eggs, which is temporarily clearing out shelves. Processor are struggling to fill orders that are coming in at a rapid pace. Stores in Iowa and across the country say they’re seeing increased prices from their suppliers as they keep working to make sure their shelves stay filled with staple products.

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U.S. Seed Companies Taking Steps to Meet Farmer Needs

American Seed Trade Association President Andy LaVigne (Luh-VEEN) says the U.S. seed industry is committed to meeting farmer and consumer demand for food. The association says its top commitment is ultimately ensuring that America’s families have ongoing access to a healthy, safe, and affordable food supply as America continues to deal with the impacts of COVID-19. “The seed industry plays a foundational role in the production of the food, feed, forage, clothing, fuel, and other agricultural products to help sustain a sound and balanced economy,” LaVigne says. “As we head into spring planting season right in the middle of the global pandemic, America’s seed companies are working hard to make sure farmers, ranchers, and homeowners, will have access to the quality seed they need to ensure a successful year.” He also says U.S. seed companies have put into place the necessary practices to comply with COVID-19 recommendations from the U.S. Centers for Disease Control and Prevention as they continue to deliver seed during this challenging time. “We appreciate the tireless efforts of American producers who are on the frontlines every day,” LaVigne adds. “We’re also grateful for the strong support and communication from Secretary Perdue and his team to ensure America’s families have ready access to nutritious food, both now and into the future.”

SOURCE: NAFB News Service

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