Letter to the Community and Farmers

Editor’s Note-Kenneth Graves is head of Arkansas Rice Growers Association and wanted to share this information with our readers and area farmers.

A lot of people that keep up with the news and economy know about the situation that the farmers are in at this time. And the reason for that is the drop in market prices in the crops that they grow.  In a nutshell, that is the main facts that I have seen concerning this problem.  So, lets bust that nutshell open and pour out the facts and tell people what could happen complete with some numbers and the domino effect it will have

.On August 16th, I was contacted by Mike Merritt in DeWitt, Arkansas, a crop consultant who owns FARM INC., made me aware of some very disturbing news.  With the bad outlook for farmers and the markets for prices for their crops, he told me that a couple of banks in different parts of the state, had told one of their customers, that it looked like 30 percent - 40 percent of their farmer customers will not be able to farm next year unless something out of the ordinary happened in favor of the farmers.  So, that information came from two different banks, one located in the north and one in the south of the state.  After talking to another banker face to face, he confirmed that number is very real. But maybe a more realistic number could be 25 percent - 33 percent, which is one-fourth to one-third of our farmers.  Now I am only talking about rice, soybeans, and corn farmers. I can’t speak for other farmers with different crops, but they use some of the same inputs also. With those numbers out there confirmed by a few banks, let's kick the can down the road some more.  I am not saying that number is the same at all ag related banks.  Some could be lower, and some could be higher.  But when the numbers are the same at the banks that have been contacted, this is getting scary.  IF, that percentage of farmers get out of farming, across the eastern part of Arkansas, here is where the dominos start falling. 

In the past, when a farmer decides to retire from farming, there is always someone who is looking to pick up extra ground.  That may not be the case next year.  With another uncertain year ahead, that farm could possibly not be rented or leased out, not knowing for sure what lies ahead.  And adding insult to injury, when that farmer has his farm auction to sell his equipment, it probably will not bring what the equipment is really worth, at least to the owner.  With that in mind, IF that happens to all of the farmers who get out after this year, what happens to the small farming towns and communities that depend on those farmer monies to support their businesses so they can make a living.  Like chemical, fertilizer, fuel, equipment dealers, hardware stores, but also the other businesses that a lot of rural towns have.  

The farmer problem goes much deeper, that is what no one is talking about. How long can they last until they have to close and move on to whatever.  Some communities don’t have much to start with as far as businesses, what about them?  Some farmers wanted to get out of farming last year but were afraid they wouldn’t get much for their equipment, so they stayed in for another year.  

There is one thing about farmers: they are one of the most optimistic people on the planet, always thinking that hopefully it will be better next year.  But optimism only goes so far. I know with the passage of the “BIG BEAUTIFUL BILL”, there is some emergency money for farmers next year. NEXT YEAR.  Farmers need something this year, and now.  At this time, I am sure any non-farming person is probably saying, well they want another handout.  Know this, The Farm Bill is not a stand-alone bill, it is part of the Nutrition Bill. 

Unless it has changed, the Farm Bill is only 2 percent - 3 percent of that bill, money wise.  A farmer is not like other businesses, we can’t set our price for our customers when they get ready to sell.  We can’t pass on the price increases to the consumers, we have to absorb it.  It is like we have to ask, “what will you give me for it”. And by that, we have to take what the market says it is worth. To give you a good example, John F. Kennedy once said, “A farmer buys retail, sells wholesale, and pays the freight both ways”. Farming is a crap shoot.  You gotta love it to do it.  But times like these, not much fun in it right now. 

In a conversation with some ag lenders, one asked another what his thoughts were as to what the farmers needed bushel wise to make it this year.  The three numbers he gave him were 100-300-300, Soybeans-Rice-Corn.  Ball park averages on those three are around 56-166-175. Those are close I believe, but not close to what is needed.  I hate to be Johnny Raincloud with this information, but I’m saying what no one is saying.  I sure hope I’m wrong.  I farmed for 49 years and had both good and bad years.  I remember in the late 70’s or early 80’s with the deficiency payments.  We were offered $1.35-$1.70 cents a bushel for our rice, and the deficiency payments were enough to get you to $3.25-$3.50 a bushel.  Times and costs were different then from now. 

I know up in the Northeast part of the state, a lot of rice farmers were hit with a lot of bad weather like rain. Too much rain. So bad that a lot of flooding took place, and the water didn’t drain off in time to plant. I am told there are a lot of unplanted fields in that area, due to the flooding. If there is an exodus of farmers next year, low prices for crops, it might get worse, and not just for farmers.

So, at this time, for any farmers that have never called their elected officials, state or U.S. about anything that bothers you, now would be a good time to stand up for yourself and get involved. This involves you, don’t count on someone to do it for you. A lot of calls make a difference. And call more than once. Blow the phones up with calls. It is now or never for some, at least try. This letter will be shared with media and politicians to try to help this situation that might occur, to make them aware about an unspoken possible problem.

Kenneth Graves

Crockett’s Bluff