Why Food Democracy isn’t really about Democracy.

Right now, a group called Food Democracy is urging folks all over the country to try and stop the continuing resolution passed by congress last week from being signed. They claim there is a piece in the CR called the “Monsanto Protecting Act” (which, I might add, is a made-up BS term). What they are really pissed about is the fact that this small piece of the CR protects farmers from activists and activist judges. Let me explain...

This small piece allows the USDA to allow for the cultivation and harvest of a crop, even if a judge or court has ordered it to undergo further review, and be removed from the market place. And we aren’t talking about some wild ideas here-we are talking about a group who wants to remove all traces of GMO crops from the planet, by any means necessary (kiss your seedless watermelons goodbye). 

For me as a farmer, this small piece provides me with much needed security. Without the USDA stopgap, a judge somewhere could rule that my corn crop growing in the field would have to be destroyed, with no recourse or remuneration for me as a farmer. A single judge in California could rule that my Roundup Ready corn, which has nearly 25 years of testing, regulatory approval, and real world experience could be banned, and I would be forced to destroy my entire crop, costing me millions of dollars. It would bankrupt my family overnight.

But here’s a real world example for everyone:

Let’s say you buy a lot and build a new house. 2 months after moving in, a neighbor says that your house is too close to his, and he doesn’t like it. There’s no scientific or logical basis for his gripe, but he takes you to court anyways. In court, the judge rules that he’s not sure about the neighbors complaint, but just to be safe, you need to move out of your new house and bulldoze it. If he decides the neighbor is wacky, you can rebuild your house, but in the meantime, you must tear it down and find somewhere else to go.

This is the world of uncertainty we live in. I would LOVE to have the time to talk to everyone in America about technology, Monsanto, GMO crops, and why I farm the way I  do, but I can’t. So please, try to trust us, just a little, and try to trust the USDA. Anyone who thinks the USDA is in bed with bio tech companies, well, I’ve got some ocean front property in Indiana for you.

Free (corn) Markets

Just incase you’ve been living under a rock for the last 3 months or so, the Midwest, hell, the whole country, has been gripped by a massive drought, which has crippled yields, especially for corn and soybeans. In fact, the crop failures are so massive, that corn and soybean “futures” (prices) have reached record levels; and those costs, unfortunately, will in some way be passed on to the consumer. 

It’s not that we want to charge you more, but our hands are tied. The corn cattle and chickens eat is more expensive; same goes for the soybeans that pigs and dairy cows consume. And then, there’s the pink elephant in the room: 

Ethanol.

Many, many grain famers, like myself, sell some of their corn for ethanol production. Now, there is a by-product, called DDG, that is fed to cattle in place of “whole” corn, so it’s not a total net-loss for feed. However, that hasn’t stopped several livestock groups and some producers from calling for a “waiver” for the amount of ethanol the government says we need to put into our gasoline.

Now understand, I’m writing this from the perspective of a grain farmer; but I’m also writing as a consumer of meat and dairy products. What I have the biggest problem with, in this whole “waiver” debate, is that the government is picking winners and losers, and when that happens, we all loose.

If we allow the government to shut down ethanol production to satisfy the demands of livestock producers, then what about the inverse? When corn prices crash, can we demand an increase in ethanol to prop up my industry? How about then dairy prices drop; should we control supply with a national quota system? The same quotas could apply to pigs, turkeys, ect. 

If we head down this road today, we are asking the government to take away our rights to free markets tomorrow. 

I’m not going to propose a solution to this issue; I know folks at all corners of this table who are struggling, and who have strong opinions. The larger question I simply want to ask, is, are we as farmers and ranchers ready to give the government this much control over the principals of free market economics that we all thrive under??

Jeff VanderWerff is a 4th generation fruit and grain farmer from Sparta, Michigan. To learn more about his family farm, and the drought, visit www.youtube.com/agsalesman

Bailouts, Handouts, and Crop Insurance

So there seems to be a lot of confusion out there by many people, including people who I believed understood how this system works for farmers. In the spirit of full disclosure, the numbers I’m sharing are generalized, and this blog is going to be long...so bail now if you’re not into understanding economics, farm finance, and insurance.

People often see or hear about a crop loss, in this case fruit, and wonder about the “bailout” the farmers will receive. Well, first off, there is no bailout. My farm isn’t GM, and I don’t have union clout to demand help. The government does provide disaster payments, so I’ll address those first.

When you hear about a farmer receiving a disaster payment, some would have you believe that a USDA or FSA (Farm Service Agency) person shows up at the farm, says “well Jeff, how bad was it?” and whips out a check for a couple of hundred grand. Let me impart some reality on you; we last had a major freeze event in 2010. Joe and I lost about 1/2 of our crop that year, and the government declared a disaster for our area. That started a going-on-two-year bureaucratic nightmare that still hasn’t resulted in my seeing a single damn dime of money. Is the government going to just “mail me a check”? Probably, but who knows when; if it was really that dire, I’d be bankrupt looonnnngggg before those ultra efficient government employees decided to act. Oh, and the amount? Probably about 20 or 30 thousand dollars which yes, sound like a lot, but when your farm has gross revenue north of 300 thousand a year, it’s peanuts.

So that brings us to crop insurance, which most of us have, and all of us support. So here’s the basic rundown of how it works; every year in October, I have to decide if I want to have insurance for the next year; keep in mind, I’m still picking my current crop and now I need to start making decisions about my NEXT crop. And if I do want insurance, you pay now. Upfront. Like, 20 grand. And no, they don’t except monthly payments, food stamps, or American Express. It’s cash on the dash if you want to play. So let’s say we do have that catastrophic loss that we saw this year; first, it’s not like car insurance. They don’t run out, look at the damage, and pay. They wait; we MIGHT see an adjuster by July or August. And the check? Probably October 1, best case. So every year, you write this check, hoping you don’t freeze, or have hail, but if you do you have your crop insurance. Payday, right? Well, check out the math....

So here’s where the rubber meets the road. How much insurance money comes in, versus how much it costs to keep the lights on. So here it is:

Crop insurance revenue: roughly 1100 dollars per acre; I farm about 120 acres.

Cost of sprays, trimming, mowing, and maintenance: around 1300 dollars an acre.

Cost of payments for such minor things as: land, bank loans, machine payments, insurance, utilities, ect: around another 75 thousand dollars a year.

So do the math: at the end of the day, even this this “huge payout” I’m loosing my ass. Plain and simple. Crop insurance isn’t about a “giant payday”, it’s about keeping the wolves away and hopefully living to fight another day. 

And here’s where the shit really hits the fan; we have NO apples. NONE. ZERO. ZILCH. Ok, well, I did find enough for a pie the other day, but that’s about it. See, normally, a loss of 1/2 the crop would trigger an insurance payment; or a hail event would trigger it. In either case, you still have some apples to sell, for something. Even we lost 1/2 the crop, we’d have enough to sell, with the insurance proceeds, to break even. Not the case this year; the crop insurance check I’ll receive this fall is the only revenue my farm will have until about October....of 2013.

So let me put it in real terms for most people: you make 100,000 dollars per year. Due to a disaster, you aren’t going to receive your pay, but you have insurance. In the analogy, you would be receiving about 40,000 dollars. Could your family live on that? Think you’d have to cut back on anything? 

Right now, the farm bill is being re-written; the main debate focuses on direct payments and crop insurance. This farmer supports eliminating direct payments, and improving crop insurance. I hope you’ll do the same.