Gov shuts down; For Montana Ag, the beet goes on

Photo Courtesy Corn being harvested.

 While Congress contemplates, Montana farmers and ranchers are hard at work. The sugar beet harvest is ongoing in Carbon County. Corn is being harvested. Grains are in. Montana Department of Agriculture (DOA) spokesman Ron Zellar reported, “We have two state employees assisting in the federal National Agriculture Statistical Survey. They came in to find their doors locked.” Other DOA employees are affected. “We have 17 employees who are budgeted to receive 50 percent of their salaries from the state and 50 percent of their salaries from the USDA.” Employees include those writing sanitary certificates for diseases and pesticides required to sell products overseas, employees conducting pesticide surveys, etc. “At this time we are covering 100 percent of their salaries,” said Zellar.

He said the shutdown of the USDA website listing federal price reports can make it hard to market crops. “The ‘I’ states, such as Idaho, Iowa and Indiana are deep into corn harvesting. How much they have ready to sell affects our corn prices. How would our farmers know? They’d have to go back to the telephone, looking for price variations and varying markets. It’s a whole process, to predict crop size.” That’s especially tricky with corn. “You never know the size of a crop until its harvested,” said Zellar. Market prices change all the time. “Farmers consider market prices before their harvest, to pre-sell,” explained Zellar. “They make decisions on futures markets for locking in prices. If prices go higher, they sell more and get their costs back.

They need to get the information; they need to know down the road.” It might be critical for corn. “Our farmers hold it in the ground as late as possible with our short season.” Subsidies are delayed. While fifty-six percent of all Montana farmers did not collect subsidies in 2012, many rely on payments on a tight budget. From 1995-2012, Carbon County received $38.4 million in subsidies. The breakdown was: $19.9 million for commodities; $3.95 million in crop insurance; $8.86 million in conservation subsidies and $5.71 million in disaster subsidies. Many Montana farmers and ranchers are transitioning away from subsidies. A look at the period from 1995-2012 for Carbon County shows some wildly fluctuating subsidy payment years as is the nature of agriculture, but most of the top ten farms receiving subsidies show a steady decrease in amounts over the years. Seven of the top ten farms in subsidy payments in Carbon County are located in Bridger. One is in Belfry.

Payment to each farm/ranch in 2012 range around $3,000-5,000, some higher, some lower. A few farms show zero payments in 2012: meaning they no longer grow the crop or no longer need the subsidy. One local farmer was surprised at being on the list since he no longer grows commercial beets. In 2012, Montana crop insurance premiums almost equaled direct payments. The top 10 percent of farmers received subsidies averaging $47,006 in payments per year between 1995 and 2012 as compared to the bottom 80 percent of farmers who received an average of $1,408 per year between 1995 and 2012 (See: Environmental Working Group at ewg.org). In 2012, wheat farmers were almost even in the amount of payments received for wheat subsidies ($89,814,808) vs. the amount of crop insurance premiums received. In 2012, Montana farmers received $6,326,410 in disaster subsidies.

The shut down means some farms receive operating loans, said Zellar. “Normally, an elevator pays the farmer for grain. However, many times the check must also be signed off on by the federal program providing the funding to grow the crop. If the office is closed, there is no money funded.” A farmer pays an elevator to store his grain, selling it for a set price at a set time. If a farmer stored his own grain (and built his own storage facility costing millions of dollars) he could choose the timing when prices are highest. Few have this alternative; it is crucial for them to know harvest sizes/current prices to determine when to bring their crops to the elevator. With no USDA price website, they must scramble for information. Farmers and ranchers received a double punch as winter approaches. Besides the shutdown stopping funding of grants, loans, subsidies, mortgages, etc., “We also don’t have the farm bill,” said Zellar. “If you are a rancher with grazing land damaged by the fires or floods there may be no assistance received because that federal program has not been renewed since October 1. There may be no disaster assistance for livestock.” In last week’s heavy regional snowstorm, South Dakota and Wyoming suffered major losses of cattle-up to 100,000 head in South Dakota alone. The U.S. Cattlemen’s Association (USCA) issued a press release on Monday, October 14. “Early estimates on livestock loss in the storm's path range between 15 and 20 percent with some counties reporting losses as high as 50 percent of herds or flocks. Crop loss estimates are not clear at this time, but some counties are reporting 75 to 100 percent of grain crops destroyed.” Jon Wooster, USCA President said, "This was a devastating event for many producers in eastern Montana, Wyoming, western Nebraska and the Dakotas.

Our hearts go out to those affected.” Wooster noted that because a farm bill has not been passed, no disaster assistance is available at this time. USCA Exec. Vice President Jess Peterson urged the U.S. House of Representatives to appoint members to the farm bill conference committee so that a five-year farm bill can be passed by Congress.  "The Atlas storm disaster underscores the need for Congress to pass a farm bill." Peterson explained. "Previous farm policy expired on October 1 and the government shutdown occurred the same day leaving producers without federal resources in the face of this catastrophe.  As currently drafted, both the House and Senate versions of the farm bill will provide for retroactive payments for livestock losses through several different programs.  Congress should move forward quickly in a bipartisan fashion to get long-term farm policy enacted." USCA Director and S.D. rancher, Danni Beer predicted a multi-million dollar hit on the regional economy. "It will take time to calculate the total impact of this storm," she said. "This was an unusually early blizzard that struck when most producers still had cattle on fall pastures. The high winds and driving snow pushed cattle over fences, so many of us are still trying to locate our animals and bring them home. Just getting roads open and trails broken through the deep snow has been a struggle. A significant after-effect is the stress on cattle and sheep that managed to survive and I suspect this will add to the storm's overall impact.” Losses are expected to rise. Zellar reflected on the storm. “Whether those ranchers will receive any assistance is unclear.”