Hoffmann column: Western Wisconsin farmers hurt by higher costs

After a couple good revenue years, Western Wisconsin farmers, like many farmers around the country, are feeling the pinch from higher feed, fuel and fertilizer costs.

Unless, they are very, very big, farmers won’t get much help from the federal farm bill, according to critics of the measure which passed the House last week.

“This bill was well designed to avoid every opportunity for serious reform of wasteful, outdated subsidy programs while actually piling on additional layers of unnecessary spending,” said U.S. Rep Ron Kind, D-La Crosse, at a news conference in Washington before the 318-106 vote.

“Commodity prices are through the roof and yet we are still funneling billions of dollars to farm households making up to $2.5 million a year in profit. I challenge any member of Congress to justify these outrageous payments to their constituents who are right now struggling with the highest food and fuel costs ever.”

President Bush threatened to veto the original farm bill so lawmakers have been working on a compromise for months.

Kind and others wanted to see the farm bill include reformed subsidies so small- and middle-sized farmers would benefit more than very large corporate farmers.

Those small- and middle-sized farmers are the ones hurt by the three Fs — feed, fuel and fertilizer.

The National Pork Producers Council says America’s hog farmers have been in crisis over the past several months, mainly because feed prices have doubled. Producers on average lose $25 to $50 on each hog, creating an industry deficit of more than $2.1 billion.

Those feed prices also hurt farmers raising beef and dairy cows. The costs are up for several reasons.

The emergence of ethanol has transferred corn to that use rather than for feed, some argue. Fuel costs affect farmers’ costs from filling up their tractors and other equipments to transporting their products.

China and other emerging countries are using more fuel and demanding a higher-quality diet, which routes more grains, etc. away from American farmers.

A weakened dollar, crop failures in Australia that led to high grain prices and a volatile commodities market have contributed to the problem.

Some who do not understand the farming industry see prices for corn and soybeans at a record high and have little sympathy. “Sell your crops for fuel,“ they tell farmers.

But, many farmers use the corn and beans for feed and thus are actually hurt by the high prices.

Western Wisconsin farmers are trying to cope with the situation in several ways. They are diversifying as much as possible, with some going into organics and other alternative crops and products.

More are selling directly to the consumers, thus avoiding some of the middle-man costs of transportation and shipping. Coops and direct-from-the-farm programs have increased.

Many are raising their own corn and beans to feed to their animals rather than buying feed. But they are still hurt by higher fuel and fertilizer costs.

One alternative is to take their critics advice and sell their corn and beans directly for ethanol and bio-diesel, but that leads to fewer farmers raising hogs and beef and to higher prices for meat.

The National Pork Council estimates hog farmers will need to reduce production by at least 10 percent, or 600,000 sows. Retail prices will go up as supply goes down, said Dave Warner, the council’s communication director.

Meat and other food price increases affect the average consumers trying to feed their families, restaurants and several other segments of the economy.

In the end, there is little Western Wisconsin farmers can do if the national and international scenes don’t change. Regional farmers do not operate in a vacuum.

The farm bill doesn’t given small- and middle-sized farmers much help, while continuing subsidies for large operations. Fuel costs don’t seem to show any signs of coming down, with some predicting crude oil prices to reach $150 per barrel or more.

So, despite some record prices, Western Wisconsin farmers find themselves in a pinch.